On Thu, 24 Jul 2003 02:10:47 +0100, Andy Hall
wrote:

With any luck, the government will continue digging in the hole in
which it finds itself and this won't make the statute books due to
lack of priority.

I think you will find this is scheduled to enter statute next April.
It has been rumoured for a while, the sparkies I did my C&G2381 course
with earlier this year knew all about it.

What you have to realise is what is going on behind the scenes. These
new regulations favour the big companies, who eventually will be the
only ones able to furnish their sparkies with the necessary experience
and certification requirements. The small one-man-band operators will
be sacrificed because in true Labour style everyone really should be
an employee of BigCo.

Being an employee of BigCo means that you are on PAYE. And being on
PAYE means it is very easy for the Inland Revenue to get at your tax.

Plus of course Labour as a political party are deeply in debt. So
there is probably some palm oiling going on behind the scenes here
with BigCo's making donations. This is EXACTLY what is going on in the
IT industry with some of the big players starving out the little guys.

Example: An IT company such as EDS (they write the Inland Revenue IT
systems which never work - e.g. child tax credit) charge out a warm
body at a cost of about £1,000 per day. They pay the warm body £200
per day, pocketing £800 per day in profit - which is taken offshore.

If the warm body were an IT contractor (as I was) then exactly the
same person who subcontracted to EDS (e.g.) would charge the same
client directly (without the EDS middle man) in the region of £300 per
day - without offshoring. Much more profitable using the little guy
who doesn't have all the overheads of BigCo.

At the end of the day these sorts of stupid policies hurt the
chancellor in ways he can't imagine. My income level used to be a
guaranteed 60K per year (that's £300 per day, 200 days worked per
year), which the chancellor gained lucrative amounts of tax on (up
until last year I paid in tax what I will now receive as total
renumeration). With the handyman business I'm likely to be earning
more like 20K per year - because that's what I need to survive on, and
if necessary I'll stay at home 2 days a week to make sure I don't pay
the chancellor any more than he has to receive. Once I've got the
loaves on the table to feed my family I couldn't give a toss about
working any harder - it isn't worth it under Labour.

Meanwhile Labour have (a) opened the floodgates with respect to giving
visas to IT migrants and (b) promoted the offshoring of work to India
and elsewhere.

As a direct result of their own policies Labour are losing tax revenue
hand over fist in the IT field, which is why Gordon is now finding
inventive new ways of taxing the blue collar worker. Remember the good
old days when Labour were going to get into power to tax the rich?

One other thing that may have slipped past the jobbing handymen.
Gordon Brown extended the reach of IR35 in this years budget to
include nannies, butlers and others who are employed by other members
of the public. That means that 95% of all income coming into your
company from a client is supposed to be treated as personal salary,
regardless of whether you decide to pay that to yourself or not:

http://www.accountancyage.com/News/1133170

There weren't any blowing of trumpets with regard to this change, but
from next April you can expect any Inland Revenue inspector to get a
gleeful look in his eye should he inspect your books (the tax isn't
due until next April).

Someone mentioned on this thread about moving to France to do up an
old farmhouse. Sounds like a jolly good idea to me!

Andrew

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web site at http://www.handymac.co.uk