Year-End & Cash Flow

Navigating tax system greatest challenge for a third of freelancers

Praseeda Nair | 1 September 2017 | 7 years ago

Photo of a man sitting on the floor and working on laptop
Almost half of UK freelancers and contractorsclaimedjob security was a constantchallenge
A third of the nation’s independent professionals have cited the demands of Britain’s complicated tax system as the biggest challenge in their working life, according to new research.

In a survey undertaken by tax advisor Qdos Contractor, Britain’s freelancers and contractors were asked of the greatest challenges of working as an independent professional.

While many had struggled to get to grips with the demands of HMRC, the most difficult aspect of surviving as a freelancer was a lack of job security, with almost half struggling to keep business stable.

For expert freelance tax guidance, take a look at FreeAgent accountant Emily Coltman’s advice articles:

The findings also uncovered some of the more personal challenges of freelancing. One in ten found separating work and personal life as their greatest difficulty, while five per cent struggled with isolation from working independently.

Meanwhile, six per cent cited believed aspects such as holiday planning, a lack of professional respect and unhelpful legislation as creating a tough environment for freelancing in 2017.

Commenting on the findings, Seb Maley, Qdos Contractor CEO, said greater freedom, control and independence? offered to freelance and contracted workers was often not met with sufficient job security.

However, he added that the changing nature of the jobs market, coupled with skills shortages, meant the demand for independent, flexible workers was growing.

in the past, independent workers have been able to enjoy certain, but limited tax advantages when working through their own companies, Maley said.

these would somewhat balance out the risk of self-employment, and the lack of security and employee-like benefits such as holiday, illness, maternity and paternity pay.

Maley explained that the freedom of freelancing had previously outweighed the lack of employee-like benefits, but moves by government to slash the tax free dividend allowance and introduce reforms to IR35 had reduced such advantages and offered nothing in return.

He added: it’s important that the government focuses on building a fairer environment for those working independently, and one where the benefits of self-employment balance the risk and lack of security.

New Making Tax Digital timetable lifts three million small firms out of transition

 

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