More of the Same from the Spring Budget?
The Spring Budget, presented by Chancellor of the Exchequer Jeremy Hunt on Wednesday, March 6th, followed a familiar path.
When Hunt presented his Autumn Statement in November, the key messages were curbing inflation, stimulating investment in UK businesses, and getting people back to work. The message from Hunt on Wednesday gave us more of the same.
The Spring Budget offered plenty of promise for the UK’s temporary labour sector, but what will economic growth and getting people back to work actually mean for contractors and recruitment agencies?
Contractors to Get Further Relief From NIC Cuts and More
Unsurprisingly, with a general election on the horizon, there was another big statement from the Chancellor to sway voters.
Following the reduction of Class 1 National Insurance in November, Hunt confirmed a further two per cent cut will take effect from the 6th April. The reduction is forecasted to save an average worker earning £35,000, approximately £450 per year. The cut means that Class 1 NICs have been reduced from 12% to 8% over the last five months. Umbrella contractors will already have begun to see the financial benefit of the first reduction and should see a further impact next month.
Self-employed individuals, who will see Class 2 NICs abolished in April, were also awarded a further 2% reduction to Class 4 NICs. This reduction is in addition to the 1% reduction announced in November, meaning that from April, Class 4 NICs will reduce from 9% to 6%.
Contractors that provide their services via their limited companies were a little aggrieved at the lack of support offered in the Autumn Statement. This time, while there were no significant changes in dividend payments or corporation tax rates, The Chancellor did provide some relief to SMEs by raising the VAT registration threshold from £85000 to £90000.
Will Business Boom as a Result of Consecutive Budget Statement Boosts?
Continued commitment to investing in British business and stimulating economic growth make promising reading for recruiters in the UK.
In Wednesday’s Spring Budget, the Chancellor committed more funding to support several UK regions and private and public sector businesses. This continued investment and the government’s determination to attract more people into work and “make work pay” point toward potentially busy times for recruiters and contractors alike.
For further information on how the spring budget may affect you, contact the Big Fish team.
Doing It For The Girls
We’re not shy when it comes to our advocacy of diversity, equality and inclusion. It is something that we’re incredibly proud of at Big Fish.
So, as we celebrate International Women’s Day, we’re delighted to announce that Big Fish Group has agreed to a two-year sponsorship deal with Runcorn Saxons, a U10s girls’ football team.
As an independent, female-owned business, Big Fish is committed to providing equal opportunities for individuals to fulfil and enjoy experiences they might otherwise not have had. Our sponsorship deal will see the Saxons receive complete home and away football kits, training kits and sideline jackets for seasons 2024/25 and 2025/26.
We’re delighted to be able to provide this sponsorship, and we’ll be regularly supporting the Saxons from the sidelines when the new season kicks off.
Runcorn Saxon’s U10 Coach Chris Hicks
“Runcorn Saxons U10 Coach Chris Hicks expresses gratitude for Big Fish’s sponsorship, emphasising its pivotal role in facilitating the provision of new kit for the girls. He highlights that this support will significantly enhance their sporting experience, fostering a sense of unity and pride within the team.”
Team fundraiser Claire Smith says:
“With Big Fish being led by two successful women in a male-dominated sector, having them on board as our exclusive sponsor investing in our girls shows our girls that they are valued and believed in with their football – which they all absolutely love. Thanks so much to Amy and Kerry!”
Chris is optimistic about the next two seasons, especially with the upcoming Blackpool tournament. Following their recent 2-1 victory over the national champions, the Saxons have demonstrated their potential for success, leaving room for anticipation of what they can achieve.
Who knows, we might be cheering on the next pride of lionesses. Keep an eye out for regular updates.
Big Fish. Proud, bold and breaking the mould.
Big Fish enhances compliance standards with SafeRec accreditation
Big Fish is thrilled to announce that it has successfully attained SafeRec Umbrella accreditation to enhance its compliance capability and service offering.
Our agency partners’ reputation and financial integrity are always a priority for Big Fish and are a major reason we have pushed to secure SafeRec accreditation. Complementing our Professional Passport accreditation, SafeRec provides our agency partners with a transparent and independently audited payroll proposition.
The information and reporting that SafeRec delivers will provide our agency partners with a level of detail and insight beyond anything we’ve seen before.
With the risks posed to employment businesses by non-compliance in the supply chain, SafeRec Umbrella accreditation positions Big Fish at the forefront of compliant and transparent payroll operations.
What does Big Fish’s SafeRec accreditation deliver?
SafeRec is an independent piece of AI software that conducts real-time audits of every payroll process and payslip generated by Big Fish. SafeRec addresses the issues of due diligence, compliance and transparency by providing the following:
- An independent review of Big Fish’s payroll operations, systems, processes and contracts to ensure compliance with UK tax and employment law.
- Real-time payroll and payslip auditing through API integration with Big Fish’s payroll software. Every Big Fish payslip is reviewed at source to check and confirm accordance with PAYE rules. All deductions are also cross-referenced with payments made to HMRC.
- Agency partner and end-client reporting on all contractors and their payslips. Generated independently by SafeRec, regular payslip audit reports provide detailed data to confirm payroll compliance and provide an audit trail and history for future reference.
With SafeRec umbrella company certification, Big Fish provides another added level of protection and security to our agencies and their end clients. We remove the risks associated with non-compliance and provide the peace of mind you need from an umbrella provider.
Navigating the Pitfalls: Protecting Yourself From Non-Compliant Umbrella Companies
In the contractor realm, compliant umbrella companies offer vital payroll services, allowing professionals to focus on their assignments. However, the industry has been blighted by companies promoting tax avoidance schemes that can lead contractors to financial peril.
Like Big Fish, any compliant umbrella company should prioritise its employees’ protection and financial well-being (contractors). So, here are our tips on how to spot and navigate the dangers posed by rogue umbrella companies:
1. A very simple first step is to check with HMRC.
HM Revenue & Customs produces a list of umbrella companies that promote tax avoidance schemes. You can find the list at https://www.gov.uk/government/publications/named-tax-avoidance-schemes-promoters-enablers-and-suppliers/current-list-of-named-tax-avoidance-schemes-promoters-enablers-and-suppliers
These organisations should be avoided at all costs.
2. Beware of “free” services.
Umbrella companies have to cover their operational costs, so they have to recoup them in some way. This is traditionally done via the umbrella margin. Any “free” payroll service offering will likely include hidden fees or dubious practices.
You should beware of any such offers, as it is likely to be you who ends up paying.
3. Be wary of tax promises such as increased take-home pay.
Most non-compliant umbrella companies promise tax savings, usually achieved through tax avoidance schemes. These schemes regularly lead to unpaid taxes and penalties that you’ll be liable for. As the saying goes, if it sounds too good to be true, it probably is.
Always safeguard your financial security by prioritising compliance over dubious savings schemes.
4. Do your due diligence.
Check to see whether the umbrella has any compliance accreditations and look at reviews on sites like Trustpilot, even where the supplier is part of the recruiter’s preferred supplier list (PSL).
5. Accept and understand your liability.
As a contractor, you will ultimately be liable for your tax obligations, even if you have been involved in tax avoidance schemes without your knowledge. Selecting a trustworthy and compliant umbrella company is crucial to protecting you from HMRC investigations, unpaid tax demands, and penalties.
In summary, you may find yourself in a position where you have no choice but to utilise an umbrella company’s services. While you understandably want to maximise the income you can generate on your assignment, you must do your due diligence on the available providers.
Avoiding non-compliant and unscrupulous umbrella companies will mitigate the risks associated with tax avoidance schemes and save you a great deal of hassle and money in the long run.
Trust us when we say it’s not worth the risk.
For further information on how Big Fish can support and protect you, contact the Big Fish team at 01925 989800 or visit our website at www.bigfishgroup.co.uk
Supporting Your Contractors When They Need it Most
For our agency partners, we understand that supporting your contractors while you focus on your recruitment activities is paramount.
We know the last thing you need is for your contractors to leave because they’re not getting the required support or service, especially when times are challenging.
At Big Fish, we are committed to providing a support structure founded on quality, compliance, availability, and care. We’re always prepared to go the extra mile to keep your contractors content and loyal to your agency.
By doing so, we can strengthen your relationships with your contractors and improve your chances of retaining them for future assignments
The Cost of Living Crisis Has Challenged Contractors in the UK.
Over the last 18 months, the UK hasn’t been the easiest place to earn a living as a contractor.
Economic crisis, political turmoil, and global conflict have all contributed to a volatile and fragile economy, with UK businesses needing to figure out how, who, and when to recruit. For contractors, it couldn’t have been much worse.
The cost of living crisis in the UK has hit contractors hard and forced many to seriously consider their positions. Inevitably, this has led to many contractors stepping away from contracting altogether or moving on to more lucrative or lengthy contracts.
At Big Fish, we’re always working hard to provide your contractors with the support they need, especially when times are tough.
Big Fish Support Eases Contractors’ Worries.
At Big Fish, we always go above and beyond to support your contractors.
For a start, we’re available 24/7. A friendly voice is always at the end of a Big Fish line when your contractors need us most.
Providing employee rewards that deliver cost savings on everyday purchases gives your contractors some welcome financial relief, especially when times are tough.
Our employee pension scheme allows your contractors to save tax-efficiently for their futures.
Our daily faster payments mean that your contractors get their money paid promptly; and when most needed.
We’re behind your contractors every step of the way to ensure they can focus on delivering for your clients. Happy clients and contractors mean longer-lasting assignments and stronger client relationships for you.
For further information on how Big Fish can help you build better and longer relationships with your clients and contractors, contact the team.
Autumn Statement Offers Contractors Short-Term Gains
The Autumn Statement, presented by Chancellor of the Exchequer Jeremy Hunt on Wednesday, the 22nd of November, was always going to be interesting for contractors.
A sustained spell of rising inflation and a cost of living crisis with interest rates climbing and soaring fuel costs have hit contractors’ pockets hard in the last couple of years. And, as is always the case in challenging economic conditions, businesses tighten the purse strings, and contract assignments become more challenging to find.
So, with the statement promoted as having a strong focus on stimulating economic growth, supporting UK businesses and getting people back into work, what did it all mean for contractors?
NIC Cuts Offer Short-Term Relief for Some Contractors
There was positive news for contractors employed by umbrella companies and those providing their services as self-employed individuals.
The relief came in the form of cuts in national insurance contributions and an increase in the national living wage.
Lower-level earners aged twenty-one or over will benefit from an increase in the national living wage to £11.44 per hour.
And, from the 6th of January 2024, Class 1 employee NIC will be reduced from 12% to 10%. The two per cent reduction was forecasted to save an average worker earning £35,400, approximately £450 in 2024-25.
Both changes will result in workers having more money in their pockets and less pressure from the cost of living challenges.
There were also NIC cuts for the self-employed, with Class 2 NIC being wholly abolished from the 6th of April, 2024, and Class 4 NIC being reduced from 9% to 8% from the same date.
Contractors can look forward with hope following the Autumn Statement
For contractors, the Autumn Statement’s commitment to stimulating growth in UK business looks to bode well for future work opportunities.
Many actions and plans included in the statement were geared toward stimulating investment and creating jobs. If forecasts prove accurate, contractors can hope for choice and longevity when looking for future roles.
One final point of note was the government’s guarantee of tougher measures and consequences for promoters of tax avoidance schemes. Such actions should give contractors and hirers peace of mind at the reduced risk presented by the temporary labour supply chain.
Autumn Statement Dampens Umbrella Sector Expectations
Considering the amount of hype and expectation within the umbrella sector leading up to Wednesday’s Autumn Statement, there was disappointment from many after Chancellor Jeremy Hunt had delivered his plans.
However, that’s not to say that the statement didn’t contain any points of interest for the UK’s temporary labour sector.
With the Chancellor’s statement leaning heavily towards stimulating economic growth, supporting UK businesses and getting people back into work, the longer-term impact of the statement was likely to hold some interest for the employers, employees and the self-employed.
How did the Autumn Statement Impact the Umbrella and Recruitment sectors?
The umbrella sector has been the subject of much conjecture in recent years; however, the statement contained little directly about the sector.
In contrast, the recruitment industry had some interesting elements to consider.
We’ve highlighted some of the major points below;
- From the 6th of January 2024, Class 1 employee NIC will reduce from 12% to 10%.
- Class 2 NIC for the self-employed will be abolished from the 6th of April, 2024.
- Class 4 NIC will reduce from 9% to 8% from the 6th of April, 2024.
- The national living wage is to increase to £11.44 per hour for anyone aged 21 or over.
- Tax relief on plant and machinery expenditure, known as full expensing, is to be made permanent and should stimulate billions more in business investment.
- Further investment in and additional investment zones resulting in an additional 65000 jobs.
- Back to work plan for the sick, disabled and long-term unemployed, expanding candidate pool.
- Stricter measures for those seeking benefits to help encourage people back into work.
Autumn Statement Summary
Umbrella contractors, low-level earners and the self-employed will benefit from cuts in national insurance and an increase to the national living wage in 2024, giving workers some much-needed financial relief from recent rising costs.
Businesses of all sizes will benefit from several tax relief and funding initiatives, which have all been introduced to help stimulate growth and investment.
The benefits may not be immediate for the UK temporary labour sector; however, the long-term prospects due to increased investment, job creation, and a broader candidate pool should all bode well for a buoyant employment market in the coming months and years.
Supporting agencies and their contractors
There aren’t many business relationships with the same level of influence on customers as an agency and an umbrella company.
For agencies, contractors represent an invaluable commodity that represents their business, enhances their reputation and provides a consistent and regular revenue stream.
So, to delegate employment and pay, two of the most sensitive elements of a worker’s welfare, to another business is a decision we never expect you to take lightly.
Agencies need quick, efficient and professional support for their contractors.
Big Fish may only have been around for four years (and a bit), but our team of payroll experts have over thirty years of combined experience. So, if there is one thing we’ve learned over all those years, agencies and their contractors need quick, efficient and professional support.
The fewer the issues and problems, the better.
That’s why Big Fish is committed to providing our agencies and contractors the highest levels of service possible. We are constantly reviewing our processes to ensure that they meet the needs of our customers, and we continually invest to ensure that we exploit the latest technological and software developments.
Big Fish Group provides a service that is second to none.
At Big Fish, we believe we’re better than the rest.
But don’t listen to us. We’d prefer that you hear it from our customers.
“I have worked with Kerry and BigFish for a number of years. Kerry and her team are knowledgeable and supportive and provide a service that is second to none. The most important part of our relationship is that whenever my contractors need support or issues resolved, I know that the team will do so quickly, efficiently and professionally. Our relationship is a cornerstone to the ongoing success of Grassroots Recruitment.”
Steve Byrne | Director
Grassroots Recruitment
Big Fish Group – Supporting you and your contractors.
At Big Fish, we know that your reputation is at stake if we get it wrong with your contractors.
That’s why we are committed to continually reviewing and improving the levels of service we provide. If you’re looking for an umbrella that provides a second-to-none service to your contractors, contact us today.
Agencies. Who’s looking after the KIDs?
It’s been said many times, but KIDs are a huge responsibility.
While they may not be at the top of the to-do list when placing contractors, looking after your KIDs can make your life much easier in the long run.
KIDs, or Key information documents, should be issued to contractors before you place them on assignment, and, as recent case law has demonstrated, not taking responsibility for your KIDs can be a considerable risk.
Why are your KIDs important?
According to the government’s guidance on providing KIDs to agency workers;
“The key information document is intended to improve the transparency of information for agency workers, particularly around pay. It will give agency workers more immediate access to key pay-related information before agreeing terms with an employment business and a clear idea of how any fees and deductions will affect their pay.”
Can KIDs put you at risk?
In short, yes.
Issuing KIDs can make life much easier in the long run as they preempt many of the questions contractors ask when they start a new assignment. KIDS are an excellent upstream process that can negate many issues agencies regularly face during contractor assignments.
However, the most significant risk is in not issuing a KID.
As KIDs are now a legal requirement, failure to issue them is deemed as a breach of the 2003 Agency Conduct Regulations and can result in penalties to the agency.
Big Fish can help to look after your KIDs
At Big Fish, we’re always happy to lend a hand, even when it comes to your KIDs.
We can help to ensure you take responsibility for your KIDs and provide all the information necessary.
If you’re unsure what to do about your Key Information Documents or want to check that what you’re currently doing is correct, call the Big Fish team
Contractors, don’t forget the KIDs
Securing a new contract can be an exciting time, but it can also be a hectic time.
With so much going on, it’s easy to overlook or miss things, and when it comes to rates, terms and conditions, the last thing you want is any mix-ups.
It’s why we at Big Fish always recommend that you get your KID (key information document) before you start your assignment so you clearly understand what is going on when you begin your new assignment.
Why are your KIDs important?
Your agency issues a KID and should provide you with all the essential information you need before starting your assignment.
Your KID will outline your employment status and relationship with your agency and show when you will be paid and who by. It should also give you an example breakdown of your pay and any fees and deductions made when you get paid. These details are essential to help you understand your pay during your assignment.
Other details shown in your KID can include how often and when you’ll be paid, and you can expect to be given a new KID if there are any significant changes to the details or terms of your assignment, such as a change in rate.
Getting to know your KIDs
For more information on KIDs, check out the government’s guidance notes – https://www.gov.uk/guidance/key-information-document-guidance-for-agency-workers-paid-through-umbrella-companies