Onshore employment intermediaries legislation is not impacting negatively on Umbrella Company Employees and other skilled freelance independent professionals in the construction industry as originally feared, as demand for construction professionals soars.

So says new research from contractor accounting specialist NoPalaver. The new rules came into effect in April and were designed to stamp out what the Revenue saw as the abuse of self-employed tax benefits. The construction industry, which relies heavily on self-employed sub-contractors, featured prominently in the Revenue’s deliberations, with tax officials suspicious that many were not genuinely self-employed.

The commercial property market has been recovering robustly during 2014, however, with vacancies in the construction sector skyrocketing by 36% year-on-year. Rapid house price growth has encouraged builders to push ahead with new builds, driving demand for skilled workers in the process.

NoPalaver Group’s director, Graham Jenner, said that construction firms were benefiting from government encouragement to expand house building, creating more assignments for skilled construction contractors in the process. In addition to domestic properties, Mr Jenner added, the commercial property market was also recovering well, providing a further boost to the construction sector.

Addressing the impact of the new onshore employment intermediaries legislation, Mr Jenner explained:

“The construction sector is still working out how to deal with HMRC’s changes, but we anticipate that the new rules will not significantly reduce the number of self-employed workers in the construction sector. The self-employed workforce is vital for construction companies who depend on their flexibility to adjust to rapid changes in demand, so they will need to review their processes to ensure that they meet HMRC’s new rules.”

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