As we have been reporting on Freelance UK for the weeks following the Chancellor's pre-budget announcement it seems as though the Government are planning to change the way small companies are taxed following the Budget in April.
The Federation of Small Businesses (FSB) is demanding that the Government provides more information as a matter of urgency. It also wants to see the plans postponed until at least next year so that the Treasury can hear the views of businesses, accountants and tax advisors.
The changes were first mooted when the Chancellor presented his pre-budget report last month. They have since become known as 5.91 or IR591 after the number of the paragraph hidden deep in the report that hinted at the plans.
Neil Hamper, FSB Taxation Chairman said:
"We can’t be sure about what is going to happen as the Chancellor has so far refused to shed light on the subject but the suspicion is that small companies will be forced to pay National Insurance on their dividends."
"When you are short of money, every little bit here and there helps. It is disappointing that in Gordon Brown’s desperation to increase the ‘tax take’ he is ignoring the Government’s promises about being open, consulting on changes and talking to people who will be affected."
The influential Treasury Select Committee last week backed the FSB's calls and called on the Chancellor to publish more details "in advance of the budget."
Jan 28, 2004
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