With a lack of support during the pandemic as well as the financial strain caused by lockdowns, the latest tax hikes will be another blow for limited company contractors.
This is according to the Association of Independent Professionals and the Self-Employed (IPSE), who believes that the government’s new dividend tax hikes are making it ‘almost impossible’ to contract through a limited company.
Andy Chamberlain, Director of Policy at IPSE, explained, “After the financial damage of the pandemic, exclusion from support and the changes to IR35 taxation, this new tax hike on dividends will make it almost impossible for freelancers to continue to work through a limited company.
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Email Jaime“To limited company directors – from project managers to graphic designers – this is salt in a year of wounds.
“The increase in National Insurance for sole traders will also be deeply damaging to the wider self-employed sector. While social care is of course crucial for the country, after the financial devastation of the pandemic, it is simply not right that hard-working and often struggling people – particularly the scarred self-employed sector – should be paying for it. These changes will squeeze the battered self-employed community – limited companies and sole traders alike.”
To find out more about contracting please contact Jaime on 01442 795 100 or email jaime.thorpe@dolanaccountancy.com.
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