Crystal Umbrella

It has been announced that former Chairman of the Inland Revenue, Sir Nicholas Montagu, KCB, has joined Crystal Umbrella, the professional Contractor’s payment solutions company, as an adviser.
Nick Montagu had a distinguished Civil Service career for thirty years, working under both Conservative and Labour administrations on some of the most challenging and controversial issues. As Chairman of the Revenue in its greatest period of change, he is credited with transforming the Department from one that was secretive and inward-facing into one that is open and customer focussed.
As an adviser to Crystal Umbrella, Nick will be working with the directors to help steer the strategic direction of the company as it builds on its strong growth and consolidates its position as one of the country’s leading Umbrella Companies. Colin Howell, co-director of Crystal Umbrella, commented, “I’m delighted to welcome Nick Montagu on board. His knowledge and experience will be highly valuable in guiding Crystal Umbrella as we move forward in the growth years ahead, with ever more challenging aims and objectives.” Nick Montagu said: “It is a great pleasure to be joining a company like Crystal Umbrella, with its strong values and compliance record. I know from direct experience how invaluable a company like this can be to employees and HMRC alike in ensuring that PAYE obligations are accurately identified and promptly settled. I look forward to working with the Crystal Umbrella team, and hope to deploy my experience to enhance its effectiveness and profile, bringing real benefits to both Clients and Government alike.”
This exciting move for all Crystal stakeholders only helps to strengthen their position as a leading and secure Umbrella Company. With compliance uncertainty still a major industry issue, this move gives Agencies and Contractors peace of mind that the Crystal Umbrella service is built on the foundations of integrity, compliance and professionalism. Contractors will continue to have the first class service offered by Crystal Umbrella, with the knowledge that they are receiving this service that is backed by such a key figure within the industry.

Many analysts had predicted that the demand for IT contractors would decline as the economic condition continued to deteriorate. It now looks like IT contractors in the financial industry are doing much better than was originally expected. The last few months did see a reduction in the quantity of contractors hired in IT, but that trend seems to have ended last month.

Staffing firm Powerchex noted that in the month of December there was a 75% decline in the number of IT contractors that were hired. In a surprising turn around, there was a 30% increase in the number engaged in January.

A director of recruitment in the industry, Paul Elworthy, said that there were indications that IT contractors were doing well in the financial sector. Elworthy also added “There do seem to be signs of some increased hiring for contractors in the financial services space. But I would be loath to refer to it as a recovery quite yet. January is usually the beginning of the new budgets so there is a little more freedom to hire so the change from December to January can be quite a positive one.”

The majority of IT contractors hired in the financial industry ended up in the insurance and investment banking areas. Elworthy also noted that a majority of the candidates that found work in January were experts on particular subjects. This allowed them to stand out amongst other applicants which may have increased the demand for their services.

Source: www.contractoruk.com

Following the recent Crystal Umbrella ‘Win a laptop’ promotion, we are delighted to announce that Sarah Louise Doherty has scooped the prize. Sarah, who currently works in the Financial sector, was delighted with the news and even more so, when Crystal Umbrella visited her to present her with the new Dell Laptop.

Sarah’s name was drawn at random out of those Contractors who joined Crystal Umbrella over the month of December. “I was shocked to be the winner,” explained Sarah, who goes on to describe that it was a lovely surprise to receive such a great prize and believed that the incentive of a prize draw was only second in the reason that she signed up to Crystal Umbrella. “The competition was an added bonus as the reason that I chose Crystal was due to their reputation in the industry, and the way in which the New Business Team explained their services. I believe I’m working with one of the best Umbrella’s out there,” said Sarah.

“We would like to offer Sarah our extended congratulations, and wish her the best of luck on her existing and any future contracts”, added Jon Myhill, Marketing Executive at Crystal Umbrella.

As the year 2009 gets off to a slow start, many IT contractors are finding themselves in a position of uncertainty. Will they or will they not have a job in the coming months? As the recession progresses, many companies have had to make budget cutbacks which means that there is less money available to hire IT contractors.

In these challenging economic times, it will be important for IT contractors to pay close attention to tax regulations such as IR35 and not to be tempted to stray from the strict guidelines. HM Revenue and Customs will be acting to enforce compliance with the guidelines and any IT contractor that fails to meet their deadlines can expect to be penalised. New penalties are being put in place by HMRC this spring and it will be particularly important to pay special attention to information about these to avoid an unexpected fine. HMRC is trying to work closely with IT contractors to help them become fully aware of what it is they need to do in order to remain compliant.

There is some good news for IT contractors though. Several industries such as aerospace and gas continue to do well despite the current recession. It is possible that demand for IT contractors from these sectors will increase as they attempt to streamline their processes to become more efficient. It is often possible for an IT contractor to switch between industries with little or no problem and by doing so they may experience a greater degree of job security.

HM Revenue and Customs has released new guidelines regarding penalties for anyone who may fall under the umbrella of the Construction Industry Scheme, or CIS.  The purpose of the new guidelines is to encourage people to comply with regulations related to CIS by trying to alter behaviour patterns.  The new guidelines are also meant to be just and not overly aggressive.

A recent study conducted by MORI revealed that people might view paying taxes as less of a priority than other bills that might be due at the time.  As times are difficult during the current recession, some people are choosing to pay bills that will allow them to keep their business running instead of paying their taxes.  If HMRC were to impose harsher penalties, they could potentially put a number of companies out of business.  The goal of the new guidelines is simply to come up with reasonable penalties.

According to the document released by HMRC “There is absolutely no doubt that in considering how to encourage people to file returns and pay tax due on time, penalties are only a small part of the picture. Simplifying those obligations where possible, clearly communicating what taxpayers need to do, and providing accessible targeted support, are likely to have more effect than penalties on their own.”

It does appear that penalties can be effective.  In instances where no penalty is issued for a late payment, the rate of payment is frequently lower.

Source: www.accountingweb.co.uk

BP has decided to eliminate its IT freelance staff in an effort to reduce cost given the current economic decline.  If any IT freelance worker wants to continue working with the oil and gas company, they will have to sign a new contract which will mean a significant reduction to their current salary. 

It is expected that freelance workers will have to take a 10% reduction in their salary.  If freelance workers are willing to accept the smaller salary they need to do so quickly.  BP will look to fill the positions with other workers beginning as early as March 1^st.

The freelance workers that faced terminations of contracts were told that “As a valued contractor BP expects that you will make every effort to support this change and ensure minimal impact to the delivery of service to our business.”

Ironically, BP received profits worth around $25.6 billion during 2008.  This impressive figure sets a new record for the company.  The explanation for why the company is forcing its freelance staff to accept reduced pay was stated as “given the impact of the deflationary economic environment.”

Many experts in the freelance field have expressed surprise at the tactics that BP has taken to cut costs.  One of the biggest surprises is that the freelancers who are facing losing their jobs are being forced to make a decision about a reduction in their salary in a very short amount of time. 

Thanks to www.contractoruk.com for the initial report.

The protests that began at a Lindsey oil refinery have since sparked the need for a review of the construction industry in the UK and the skill shortages that might be found there.  Several contract workers went on strike at sites around the UK to protest at what was considered to be the unfair and preferential treatment of foreign workers.  Now the Business Secretary, Lord Mandelson, has said he wants to ensure that UK workers are well equipped with the skills they might need to keep UK jobs in their hands.

The review of the construction industry will be handled by Mark Gibson who is a member of the Department of Business Enterprise and Regulatory Reform.  Many government officials have said that a great number of UK contractors need to improve their productivity levels in order to obtain contracts not only in Britain but in other parts of Europe as well.

The inquiry into the strikes that began a few weeks ago has come to a close.  Several unions including the GMP and Unite have said that the foreign contractors employed at the plants around Britain received wages that were less than the minimum and that in addition they were able to work more hours.  This made them considerably more attractive to many of the employers and potentially threatened the jobs of British citizens.  At one of the Total plants, the strike was settled when they agreed to bring on an additional 102 UK workers.

It has been decided that several people who were working with JL Windows and Doors were actually working for themselves.  While the Special Commissioner, John Clarke did say that they were only barely working on their own he also noted that they should not be thought of as employees of the window company.  The case began over a disagreement over the employment status of the workers in question with regards to the Construction Industry Scheme, or CIS.

The Littlewood family, which owns JL Windows and Doors, claimed that anybody who was working with their company was a contractor and not an actual employee of the company.  These same workers have said that they were actually employees.  The amount of National Insurance Contributions and income taxes that the workers owed would vary depending on their actual employment status.

Mr Littlewood said he would use the workers’ CIS cards to determine if they were actually self-employed or not.  From there he would reduce the workers’ income by 18% to account for deductions owed to HM Revenue and Customs.

Clarke said “Although there was mutuality of obligation in the separate contracts, JL Windows did not exercise a sufficient degree of control over the workers to make itself master.”  He also added that “I do not find the other provisions of the contracts consistent with their being contracts of service. I find that the workers were in business on their own account, albeit in a modest way.”

Source: www.shout99.com

A seminar is to be held on 25th February in Aberdeen to address a number of topics relating to the international and domestic workforce, along with the various types of payments made to employees.  One of the central focuses of this seminar will be taxation.

A number of genuine situations have been turned into case studies that the seminar will use to discuss a number of relevant topics.  Several key issues relating to employees in the UK will be addressed, including problems with IR35 and the employment status of contractors.  The use of umbrella companies will also be the focus for some of the case studies.

Whilst there are certainly a number of domestic matters to discuss at the seminar, a number of international issues will also be addressed.  One such issue revolves around properly paying employees who live abroad.

Lili Hunter, a partner at Ledingham Chalmers LLP, said of the seminar “This seminar will look at the various issues which need to be taken into account, including ensuring employment contracts, immigration and tax are appropriately dealt with to avoid penalties on both sides, and options available for the streamlining of payroll.”

Hunter also referred to the energy industry, pointing out that it employs a significant number of international workers and contractors, which presents a number of issues.  She said that many employers struggle to properly determine payment methods for everyone in their employment, which can lead to a number of problems that need to be faced.

Source: oilvoice.com

Many IT contractors are finding themselves in a difficult position in the first few weeks of 2009.  Work is not as readily available as it has been in the past and the competition for jobs has increased substantially.  As a result, many contractors are now looking for different work opportunities.  One such opportunity comes from the public sector.

The public sector is seen as a good location to scout for new job opportunities as it is more likely to be unaffected by a tightening budget in the coming months.  For the most part, the budget that the public sector will use was put together in a previous year so positions and money have already been allocated. 

Most IT contractors wanting to continue with their current work are being forced to accept greatly reduced salaries.  In some cases contractors are losing as much as 25% of their income.  Many of the biggest IT employers such as Microsoft, IBM, and AMD are being forced to lay off thousands of their employees who fill both contract and fulltime positions.

A director at Hays Public Services, Mark Staniland, said of the change in working habits “A few years ago the proportion of people willing to consider a public sector job would have been nothing compared to today. Right now the public sector is becoming increasingly attractive to white-collar professionals, who see it as less lacklustre and a much more challenging and rewarding environment.”

Source: www.contractoruk.com