With latest IPSE research showing that 45% of contractors are concerned they won’t be able to afford basic living costs; Small Business Minister Paul Scrully has said he is considering ways of further supporting Limited Company contractors.
Alasdair Hutchison, Policy Development Manager at IPSE (the Association of Independent Professionals and the Self-Employed), commented, “More support is urgently needed for self-employed people working through limited companies. The limited company contractors we have spoken to are utterly despondent and feel completely left behind. Our research, too, shows that 69 per cent of limited company contractors do not feel government measures are enough to sustain them.
“The Chancellor’s Self-Employment Income Support Scheme was very generous to the people it covered, but there were several holes in the package – particularly limited companies and people who have only recently become self-employed.”
Hutchison added, “It is very welcome that Mr Scully is looking at ways to plug the gap for company directors. One way to do this would be to include dividend income in the government’s Job Retention Scheme, which company directors are eligible for but only for the small portion of their earnings that comes from PAYE. This would enable many limited company contractors who pay themselves through dividends to make full use of the scheme.
“Otherwise, we suggest the Small Business Minister considers schemes based on either a temporary tax break or targeted grants for limited company contractors in need. Either way, we urge him and the Chancellor to act quickly to extend their support package to this vital and varied section of the workforce.”
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