January 2022 CEO Update: Umbrella Companies, IPSE 2022 AGM and the year ahead
- 27 Jan 2022
January is usually associated with new beginnings, but 2022 has gotten off to a very bumpy start. Concerns over inflation, energy prices and Omicron have merged with taxation issues and the ongoing impact of IR35 to make for a very unsettled picture, not to mention the political turmoil that has unfolded around the Prime Minister.
The Wild West of umbrella companies
We understand that for many of our members IR35 continues to loom over everything they do. The changes to IR35 in the private sector in April 2021 have forced many to turn towards the poorly regulated world of umbrella companies.
While many are legitimate businesses, there are far too many umbrella companies that are exploiting workers and coaxing them into tax avoidance schemes. It is a Wild West that must be tamed. Until the industry behaviours and ethics improve, we continue to urge our members to exercise caution when choosing an umbrella company. If something looks too good to be true it probably is, so be weary of overly attractive take home rates – this is an area under significant government scrutiny at the moment.
We are also aware of the cyber-attacks that have disrupted umbrellas and potentially their payments to individuals. We hope any such disruption can be quickly resolved and that umbrella companies will urgently protect themselves from further attacks. It is imperative that individuals who are now forced to work via umbrellas due to the IR35 changes feel that their personal information and their income is secure – and yes, the government must take some of the responsibility for ensuring that happens.
If you are concerned about umbrella company working then please do take the time to take our survey which will feed into our response to the Government call for evidence. It would also be great to hear from you at our next Member Meet-Up which will be all about umbrella companies.
2022 IPSE AGM
This week, IPSE held its 2022 Annual General Meeting. I was proud to announce during the AGM that despite the difficulties that all membership bodies have faced during the pandemic, IPSE turned a profit in its last financial year and we are now in a stronger position.
The meeting was an important space for members to ask questions to the board and to get involved in their membership organisation – and I would like to thank everyone who joined live or submitted a question or proxy vote in advance.
Looking towards the rest of 2022, we are working on stepping up our member engagement by launching a series of in-person member events around the UK. With restrictions easing yet again, we hope that these events will be a chance for us to meet members face to face, offer them support and to listen to their concerns.
We are also actively campaigning on important issues such as late payment, financial wellbeing and fairer taxation as we push towards our vision of a fair environment where self-employment is an aspirational and sustainable career option.
Looking to the future
As we end the month, the country seems to be entering a state of déjà vu. Restrictions are easing yet again, another variant has seemingly come and (will hopefully soon be) gone, and business is yet again looking towards a post-pandemic future. While it isn’t wholly clear if we’re finally out of the woods, it does feel that 2022 could be better than the past couple of years.
That is not say that there aren’t challenges - IR35 in particular continues to prevent the sector from developing its full potential and the planned rise to National Insurance and dividend tax are scheduled to hit from April. In 2022 IPSE will continue to campaign on these issues as we strive to make life better for those who work for themselves.
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