The Autumn Statement – Key Announcements for Contractors
The Autumn Statement was released on Wednesday and the highly speculated ban on contracting did not appear in the report.
The Treasury did, however, say “The government continues to be interested in the IR35 area, but doesn’t have any announcement to make on it at this time.”
The main announcements that affect contractors are listed below but you can access the full report here: http://tinyurl.com/qzqfk9j
Employment intermediaries and tax relief for travel and subsistence in the Autumn Statement
As confirmed at Summer Budget 2015, the government will legislate to restrict tax relief for travel and subsistence expenses for workers engaged through an employment intermediary, such as an umbrella company or a personal service company.
Following consultation, relief will be restricted for individuals working through personal service companies where the intermediaries legislation applies. This change will take effect from 6 April 2016
Office of Tax Simplification (OTS) review of employment status
The government has responded to the final report of the OTS review of employment status and is taking forward the majority of recommendations.
Published in March this year, the OTS review put forward more than 20 recommendations included having a “set de minimise level for payments to an individual who carries out some activities for a business, which would definitely not be an employment.”
The accountant explained that, generally, the OTS recommendations “would result in greater certainty and availability of information to contractors so they can determine what their status should be when working for businesses.”
The details of the accepted OTS recommendations are expected to emerge in 2016.
Capital Gains Tax – Entrepreneurs’ Relief: contrived structures
The government will consider bringing forward legislation to amend the changes made by Finance Act 2015 to Entrepreneurs’ Relief, in order to support businesses by ensuring that the relief is available on certain genuine commercial transactions.
Salary Sacrifice
The government remains concerned about the growth of salary sacrifice arrangements and is considering what action, if any, is necessary. The government will gather further evidence, including from employers, on salary sacrifice arrangements to inform its approach
RTI relaxation to be removed
The ‘on or before’ requirement for RTI filing for payroll will be extended to all employers from April 2016 and there will no further relaxation for micro-employers such as PSCs.
Chartered accountancy firm Moore Stephens warned: “All employers will therefore need to file FPS returns no later than the date salaries are paid in order to avoid penalties.”
Company distributions
The government will publish a consultation on the rules concerning company distributions later in the year.
Other anti-avoidance measures
‘GAAR’
The government will introduce a new penalty of 60% of tax due to be charged in all cases successfully tackled by the GAAR.
The government will also make small changes to the way the GAAR works to improve its ability to tackle marketed avoidance schemes.
‘Disguised Remuneration’
The government intends to take action against those who have used or continue to use disguised remuneration schemes and who have not yet paid their fair share of tax.
The government will also consider legislating in a future Finance Bill to close down any further new schemes intended to avoid tax on earned income, where necessary, with effect from 25 November 2015.
‘Serial avoiders’
The government will introduce tough new measures for those who persistently enter into tax avoidance schemes that are defeated by HMRC.
The government is also widening the Promoters of Tax Avoidance Schemes (POTAS) regime.
‘Extra investment to hit evaders’
£800 million confirmed funding for additional work [by HMRC] to tackle evasion and non-compliance in the tax system.
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To bid, or not to bid? Are you chasing everything?
Improving bid qualification decisions may be the biggest single way to achieve a step change in win rate success, yet it remains one of the hardest areas to address.
Our partners at twentysix2 have an informative series of blogs covering various stages of the bid and proposal lifecycle. ‘To bid, or not to bid?’ is our first weekly installment.
Making sound and timely bid / no bid decisions would focus scarce business development resources on those opportunities that organisations are more likely to win – increasing bandwidth and the ability to produce quality propositions.
Why then do so many companies achieve unacceptably low win rates by chasing everything, making poor qualification decisions and wasting precious resources?
The qualification decision is rarely taken in isolation. The ‘attractiveness’ of a single opportunity will vary according to the state of the rest of the sales pipeline. In a drought, any opportunity will take on increased significance. In a glut, there will be a fight to secure the resources to chase many opportunities that would not seem attractive at other times.
Companies mistake volume for quality in their sales pipelines. Good sense would suggest that if we go for fewer opportunities that we have a better chance of winning then the increased focus will reap better rewards. However, you can imagine the Board’s reaction when you tell them “I’ve halved that big fat sales pipeline we used to have – but believe me, we’ll land more of those opportunities!” It takes a leap of faith and some lead time for such a policy change to take effect.
We live in an uncertain world. No one can predict the future with anything like 100% certainty. It is a brave manager who decides to cut out opportunities early in their lifecycle. To that end, a ‘no bid’ decision is the exception which requires substantial proof to show why we should not bid. It is much easy to keep an opportunity open, putting off the difficult decision until more information is known. This approach can lead to the gradual hemorrhaging of resources and a bigger opportunity cost in the reduced capacity to pursue other targets.
Exceptions are used to prove the rule. “We won that one, even though we heard about it late”, claims the salesperson. This is often used as an excuse to keep opportunities live in the face of mounting evidence that it should be closed down as we don’t know the first thing about the opportunity, the customer or the competition.
Qualification decisions are rarely rational as they are often made by Sales, the very people who are targeted and measured by the number of opportunities in their pipeline. The salesperson who owns the opportunity will always want to keep as many balls in the air as possible and will be emotionally attached to opportunities in which they have invested their efforts. As one world-weary bid manager used to say – “For salespeople, Qualification is as popular as drowning puppies or telling somebody their baby is ugly!”
Qualification pain is not felt by those doing the qualifying. When the qualification decision is left in the hands of Sales, the real pain that results from continuing to bid is often not felt by the Salesperson. The cost – financially, emotionally and physically – is felt by those preparing the bids. It is this team that face the long days, longer nights and pizza overload in preparing the proposal.
So, what could organisations do to improve?
- Take early decisions – to enable the full benefit of increased resources and focus to be felt on those opportunities that they really do have a good chance of winning.
- Agree the factors that would cause a no-bid – do this early on in the process to enable a rational decision later on.
- Be consistent in the application of bid / no bid decisions – and the process that teams go through. Over time this will lead to some self-governance by Sales earlier on in the process in weeding out opportunities from the pipeline.
- Take direction from Corporate Strategy – but be prepared to divert. The application of a process shouldn’t put the organization into a straightjacket that limits agility and an ability to respond to market conditions.
- Include more meaningful measures – business development good health goes beyond simple pipeline value / volume. Organisations need to recognise that ultimately it is the quality of the opportunity that will determine whether or not it becomes a successful win.
Author: Ian Sherwood CPP.APMP, Bid and Proposals Director, twentysix2
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Is your company doing enough to prevent cyber-attacks?
KPMG recently surveyed Procurement Managers from multiple industries and results have shown that the majority think SME’s should be doing more to actively protect and prevent cyber-attacks.
Participants stated that they would remove suppliers if they were victim to hacking and almost all of the people surveyed say that security standards are important to them when awarding contracts.
Is your company accredited, with strong enough standards or do you believe you could be losing contracts because it is not taken seriously enough?
Read KPMG’s overview:
Small and Medium Sized Enterprises (SMEs) risk being disqualified from bidding for work because of the lack of importance they are placing on looking after their valuable client data, according to a survey of procurement managers by KPMG.
A multisector KPMG survey of 175 procurement managers across the UK from organisations with over 250 employees revealed that the general consensus (70%) of procurement managers is that SMEs should be doing more to prevent cyber attacks and protect valuable client data.
The vast majority (86%) of respondents said they would consider removing an SME supplier if they were hacked and nearly all of the respondents (94%) confirmed that cyber security standards are important when awarding contracts to SME suppliers.
George Quigley, Partner in KPMG’s cyber security practice, commented: “Cyber security is not just a technical issue anymore; it has become a business critical issue for the UK’s SMEs. Larger companies are placing an increased emphasis on the cyber security of their suppliers and increasingly the onus is on SMEs to show that they are tackling this issue head on.
“Unfortunately many SME still take a blasé approach towards cyber security and mistakenly don’t see themselves as targets of cyber criminals. Unless these organisations take a more mature approach towards cyber security now, they face the risk of being frozen out of lucrative supplier contracts.”
Already two-thirds of procurement managers ask their suppliers to demonstrate cyber accreditations (ISO27001, Cyber Essentials, IASME certifications or PCI DDS) as a part of their procurement assessment, with this number likely to increase in the near future. In addition, SMEs are increasingly being asked to self-fund their own accreditations. In the absence of accreditation, two-fifths (41%) of procurement managers expect their suppliers to pay for their own accreditations and reach a certain level of cyber maturity in the near future.
George Quigley concluded: “In order for businesses to be awarded some public sector contracts they already have to demonstrate a certain level of cyber maturity and this is increasingly becoming the norm in the private sector as well. Companies are also imbedding cyber security in their supplier contracts with about half (47%) of existing contracts already stating that suppliers are contractually obliged to tell if they have been hacked. This means that if a SME supplier is breached and doesn’t deal with it appropriately, they could be looking at the termination of an existing supplier contract.
“The government is looking to increase the cyber maturity of UK businesses, with accreditations like the Cyber Essentials Scheme. We can only expect the bar to be raised higher in the coming years. There is no time like the present for SMEs to start taking the initial steps towards increasing their level of cyber maturity.”
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Commonly confused words – Are you guilty?
In the English language, there are many words that are commonly misused and discredit our verbal and written communications so it’s important to learn the correct meaning and context.
The article below details the most commonly confused words. Are you or your colleagues guilty of misusing any of them?
Accept vs. Except
These two words sound similar but have very different meanings. Accept means to receive something willingly: “His mom accepted his explanation” or “She accepted the gift graciously.” Except signifies exclusion: “I can attend every meeting except the one next week.” To help you remember, note that both except and exclusion begin with ex.
Affect vs. Effect
To make these words even more confusing than they already are, both can be used as either a noun or a verb. Let’s start with the verbs. Affect means to influence something or someone; effect means to accomplish something. “Your job was affected by the organizational restructuring” but “These changes will be effected on Monday.” As a noun, an effect is the result of something: “The sunny weather had a huge effect on sales.” It’s almost always the right choice because the noun affect refers to an emotional state and is rarely used outside of psychological circles: “The patient’s affect was flat.”
Lie vs. Lay
We’re all pretty clear on the lie that means an untruth. It’s the other usage that trips us up. Lie also means to recline: “Why don’t you lie down and rest?” Lay requires an object: “Lay the book on the table.” Lie is something you can do by yourself, but you need an object to lay. It’s more confusing in the past tense. The past tense of lie is—you guessed it—lay: “I lay down for an hour last night.” And the past tense of lay is laid: “I laid the book on the table.”
Bring vs. Take
Bring and take both describe transporting something or someone from one place to another, but the correct usage depends on the speaker’s point of view. Somebody brings something to you, but you take it to somewhere else: “Bring me the mail, then take your shoes to your room.” Just remember, if the movement is toward you, use bring; if the movement is away from you, use take.
Ironic vs. Coincidental
A lot of people get this wrong. If you break your leg the day before a ski trip, that’s not ironic—it’s coincidental (and bad luck). Ironic has several meanings, all of which include some type of reversal of what was expected. Verbal irony is when a person says one thing but clearly means another. Situational irony is when a result is the opposite of what was expected. O. Henry was a master of situational irony. In his famous short story The Gift of the Magi, Jim sells his watch to buy combs for his wife’s hair, and she sells her hair to buy a chain for Jim’s watch. Each character sold something precious to buy a gift for the other, but those gifts were intended for what the other person sold. That is true irony. If you break your leg the day before a ski trip, that’s coincidental. If you drive up to the mountains to ski, and there was more snow back at your house, that’s ironic.
Imply vs. Infer
To imply means to suggest something without saying it outright. To infer means to draw a conclusion from what someone else implies. As a general rule, the speaker/writer implies, and the listener/reader infers.
Nauseous vs. Nauseated
Nauseous has been misused so often that the incorrect usage is accepted in some circles. Still, it’s important to note the difference. Nauseous means causing nausea; nauseated means experiencing nausea. So, if your circle includes ultra-particular grammar sticklers, never say “I’m nauseous” unless you want them to be snickering behind your back.
Comprise vs. Compose
These are two of the most commonly misused words in the English language. Comprise means to include; compose means to make up. It all comes down to parts versus the whole. When you use comprise, you put the whole first: “A soccer game comprises (includes) two halves.” When you use compose, you put the pieces first: “Fifty states compose (make up) the United States of America.”
Farther vs. Further
Farther refers to physical distance, while further describes the degree or extent of an action or situation. “I can’t run any farther,” but “I have nothing further to say.” If you can substitute “more” or “additional,” use further.
Fewer vs. Less
Use fewer when you’re referring to separate items that can be counted; use less when referring to a whole: “You have fewer dollars, but less money.”
Bringing it all together
English grammar can be tricky, and, a lot of times, the words that sound right are actually wrong. With words such as those listed above, you just have to memorize the rules so that when you are about to use them, you’ll catch yourself in the act and know for certain that you’ve written or said the right one.
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Concerned about the rumoured ban on contracting?
The IPSE, the UK’s Association for Independent Professionals and the Self-Employed haven’t yet been able to verify the rumoured ban on contracting that is expected to be announced in the upcoming Autumn Review.
They have however been encouraging those worried about the rumoured changes, to write to the Chancellor to express their concerns.
Contractor UK have put together a template you can download and personalise here: http://tinyurl.com/p2a9ovk
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Proposed ban on Contracting
George Osborne is due to release his first Conservative only Autumn Statement and speculation around the statement and proposed changes for contractors have been high.
Reports have suggested that there could be a ban on contracting for more than a month.
After this time contractors would be added onto the payroll if they intended to exceed a month with the same organisation.
If there is truth in the rumours then millions of contractors in the UK could be affected, however, we will have to wait until 25th November until it is confirmed.
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Public Sector Procurement– Are you transparent enough?
Our partners at Sixfold have shared the latest news on Public Sector procurement and how they can help support your business through regulation changes.
“Like it or not, the new Public Contracts Regulations 2015 are going to make a big difference to how you bid for Public Sector contracts. Sixfold is all about how to finesse the Public Sector procurement to create a competitive edge.
Fundamental Principles for Public Sector Procurement
We have often focused on how the fundamental principles – equal treatment, proportionality and transparency – can be used as a tool to your advantage. These principles, if anything, are strengthened by the new regulations. This is particularly true of transparency, which the Crown Commercial Service (CCS) has detailed in one of its Procurement Policy Notes. It creates new opportunities and risks that will be of interest to all bid professionals.
Additional Measures
Central Government departments have been told that after 1st September 2015 they must implement additional transparency measures. Other Government departments have been recommended to follow suit.
Firstly, the procurement team is required to discuss and agree the information that will be made public when the contract is awarded, targeting information that has previously been withheld. This will extend to (and beyond):
- Your contract price and any incentives.
- The contract performance metrics and how you will manage them.
- The plans for the management of any under-performance and what will be its financial impact.
- The governance arrangements, including governance through your supply chains.
- Your resource plans
- Your service improvement plans
Of course, you might be adamant that you will not agree to the release of this information. However, ultimately it is the contracting authority who will make the final decision, irrespective of any supplier’s wishes or protestations.
Then, all this information will be uploaded to a publicly available section of the department’s website and as the contract progresses, updated so it remains current.
Prepare to think outside the box
For suppliers who are new to a contract area, this will give them a highly valuable swathe of information from which they can prepare their competitive responses. For incumbents, this represents another challenge to their ability to retain their contract at the renewal point. For the Government, this will, undoubtedly have the long term effect of lowering market prices and so don’t expect this requirement to lessen as time goes on!
If you want to know more about how all this may affect your next Public Sector bid and how you can take advantage of these changes, we would be delighted to discuss it with you.
Please give us a call on 01227 860375 and we will be very happy to help.
Visit our website for more information: www.sixfold.biz”
Peter Lobl
Training Director, Sixfold
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Changes to Public Sector Bidding in Scotland
Are you ready for change to Public Sector bidding in Scotland?
The Scottish government is putting in new guidelines to Public Sector procurement this week. Companies involved in Scottish Public Sector bidding will now be expected to pay employees the living wage and ban the use of zero-hours contracts.
http://news.stv.tv/scotland/1331778-public-sector-bidders-will-be-expected-to-pay-workers-living-wage/
Will this affect your bidding or does your organisation already meet the requirements?
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Did you attend the UK APMP conference this year?
Before plans for the 2016 UK APMP conference commence, you can provide your feedback on this year’s event and ensure you get the most out of future conferences.
https://response.easyresearch.se/s.aspx?WID=1033294&Pwd=27192575&key=72652,098351
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Video Interviews – Are you prepared?
As Bid / Proposal teams become increasingly more dynamic, so does the recruitment of winning team members. With multiple colleagues involved in the recruitment process and often on a global scale, requests for video interviews are increasing.
While some may be uncomfortable with this at first, it has the potential to benefit the speed and convenience of the recruitment process. It does mean that in addition to the usual interview preparation, you need to consider other aspects as detailed by Nick Williams:
Preparing for Video Interviews
1) Using headsets
Regardless of whether the role you are being interviewed for involves public speaking, your voice is a powerful tool in persuading the individual to hire you. Clear, concise diction, with an agreeable tone, will be a pleasure to listen to and can help the interviewer to pay close attention to what you are saying.
Unfortunately, the microphone on your computer may make you sound tinny, quiet and add a strange timbre to your tone. This is less than ideal and could influence your interviewer’s desire to listen to your answers.
The other problem with computer microphones is that they pick up every other noise in the room, adding a soundtrack that you would rather not include. Whether it’s other people moving around, pets, noise pollution or other sounds, it can be a real distraction during the interview.
The best way to get around this is to eschew the computer microphone and instead use a headset. This will eliminate all other noises and ensure that your answers are conveyed clearly and that your voice has the opportunity to influence the interviewer as you hoped.
The other benefit to using headsets is that you will instantly appear more composed, professional and organised, rather than giving the impression that everything was put together in a rush.
2) Your user name
When you’re applying for jobs, you might think nothing about handing about your email address and user name, happy to rely on more modern means to secure a position.
But if your accounts were set up originally for non-professional purposes, don’t forget to consider the type of reaction that your name could provoke.
Ideally, you’ll want a user name or address which is your regular name, but this might not always be possible. However, having something which is rude, offensive or just unprofessional will create an instant opinion which isn’t favourable.
If your existing account isn’t suitable for use with a prospective employer, consider either changing the name or setting up a brand new one for the purposes of recruitment.
3) Screen sharing
A lot depends on the job that you’re applying for but there may be an opportunity for you and the interviewer to screen share so that you can demonstrate some practical skills.
This can be the perfect opportunity to showcase what you really know but make sure you’re aware of everything that they can see. This means that if you’ve been googling to check facts that you claimed to already know, you could blow your chances of getting a job.
Having other chat windows open is also an extremely bad idea, even if you haven’t been using them during the interview. There’s always the chance that a friend or acquaintance could pop up and make a derogatory comment or remark during the interview.
4) Transmission delay
There’s nothing worse than mistiming your comments and either sat listening to a stony silence or constantly talking over the person who is trying to interview you.
It’s especially important to demonstrate an ease with technology if the role could potentially involve the use of computers or modern methods of communication, such as video conferencing or Skype.
There’s a real art to conversing over video, and it’s not as easy as having a physical face to face discussion. You’ll need to take account of the lags or delays that the transmission might cause and ensure that you match the rhythm of your conversation to this.
5) Picture quality and position
Unlike a physical interview, you’ll have to put much more work into creating the right position when you’re being videoed.
Rather than simply pulling up a chair at an interview table, over video, it’s up to you to create the right position which is neither too close nor too far.
Don’t forget to check the results before you go live, so you can see the view that the other party will see. You shouldn’t be higher than them, looking down can make you appear arrogant and superior. By direct contrast, position your chair too low and you’ll give the impression of being meek, mild and subservient.
Once you’re sure that you’ve got the position right, do a final check for any blurs, smudges or marks on the lens. This can be very distracting for the interviewer and may mean that you come across as less than professional as a result.
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