Well, it’s that time of the year again…. time for the Chancellor, Philip Hammond, to deliver to the UK, the Autumn Budget. Whether your self-employed, unemployed, a homeowner, a landlord (basically anyone and everyone) the Autumn Budget will affect each and every one of us.
Of course, and as usual, the news and papers are full of speculation about what is to be expected from this budget announcement, so here we review a couple of the articles which caught my eye over the weekend.
As published in the Daily Mail, Mr Hammond is set to ‘woo the Millenials and vows to build 300,000 new homes a year‘. On a positive note, this will ensure the construction sector remains strong. It’s not only the building of the houses but the new infrastructure associated with the new homes. So potentially a very positive outlook for the majority of our clients… thumbs up!
However, in the second article, the Chancellor hints at plans to toughen tax rules on the self-employed. Reading between the lines, it appears that the government may be looking at two major proposals. The first of which would see companies deduct tax and National Insurance Contributions from the gross pay of self-employed workers… the upshot, in our opinion, is that this would create a more rigid working environment and not give self-employed workers the flexibility they currently have of moving between companies and employers. It would also end up costing the companies more to hire these workers, as Employers National Insurance would also surely take a hit. The second proposal would be to reduce the VAT threshold to as little as £26,000 per year, meaning the majority of self-employed people throughout the UK would then have to complete quarterly VAT returns. This would create additional paperwork and red tape, which many business owners simply don’t have the time to deal with. Either of the proposals suggested may result in self-employed workers ditching self-employment in favour of employment…. thumbs down.
And now we reiterate that this is all hearsay, however, the rumours suggest a major contradiction as in one hand the Chancellor wants to build 300,000 new affordable homes per year, with a construction workforce that is primarily self-employed. However, on the other hand, he is potentially looking to increase the cost of the workforce, by hitting the self-employed with timely and expensive new rules.
Ultimately the two proposals don’t really work alongside each other and at a time like this, with a potential slow down in the construction sector and Brexit negotiations still not confirmed, I believe the government should be backing the self-employed and small business owners in the construction industry.
As the clock clicks ever closer to the big reveal, we can only brace ourselves for Wednesday and react to whatever is announced.
Watch this space.