Speaking to Contractor UK, BKL tax specialist David Whiscombe has commented on the Spring Statement’s potential impact on contractors and small businesses. He focuses on two of the related consultations.
The consultation about VAT registration threshold [published shortly after the Spring Statement] is the main point of interest for limited companies or, at least, those companies that are not registered for VAT.
[It’s necessary because] it’s not clear how commonly such companies are at the moment turning away potentially profitable work in order to avoid the need to get involved with VAT registration.
After the Spring Statement, the government also published a consultation ‘on the extension of tax relief for training by employees and the self-employed to support upskilling and retraining’.
The training consultation looks at first glance as if it might benefit contractors until you realise that the position for employer-provided training – which includes training organised by a contractor operating through his or her company – already benefits from good tax breaks.
This consultation is really looking at how to remove the differentials between this sort of training and similar costs incurred either – first; direct by employees or second; by self-employed individuals… [therefore] it’s not likely to affect the typical contractor who operates via a company.
The consultation offers the prospect of levelling the playing field, so that relief will be due by reference to the character of the training – rather than the structure through which it is provided. [It] is to be welcomed.
The article was first published on the Contractor UK website.
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