News, insights and advice for contractors
Stay tuned to the NWM blog for our latest company news, in-depth industry commentary and insights as well as useful guides on finance and compliance for contractors.
Increase in freelancing opportunities
While at the beginning of 2020, a world of remote working and video calls seemed entirely unfeasible, the forced shift to remote working caused by the pandemic has not only proven feasible, but also attractive, and productive. It has also been a massive accelerator for the freelance industry.
Companies like Upwork, Fiverr, and Freelancer.com all experienced significant growth in April when the pandemic first hit and have continued developing since. Today, there are dozens of freelancing platforms that provide access to a variety of different types of jobs. These platforms have increased the ease by which freelancers can access job opportunities, offer their services, and communicate with other freelancers to network and generate opportunities.
Stronger freelance community
Over the past year, with the introduction and development of many new freelance hiring platforms, there has been an increase in the sense of community of the freelance world. Many apps encourage communication between freelancers and contractors, with some offering services which allow freelancers to share job opportunities, contacts, advice, and even team up on particular projects.
For example, startups such as Contra and VentureL are focused on building communities by relying on an invitation only approach (similar to LinkedIn), creating a network which supports sharing leads, hunting in packs, and working together. Whereas Freelancing Teams and Vicoland take a slightly different approach; they see the future of freelancing as team-based and support the creation of ready-to-go teams that can work together on a range of jobs. We can expect to see a continuation of this sort of behaviour through 2021.
More professions to incorporate freelance
Alongside the increase in remote working, this introduces more opportunities for contractors and freelancers to work in a wider range of fields. With all industries currently looking to recruit remote workers, new doors are opened to freelancers, with all industries setting their eyes on new ways of working.
Over the past year, the freelance industry has seen a massive increase in the number of freelance opportunities in sectors such as tech, management consultancy, PR and communications, engineering, construction, pharmaceuticals, finance, HR, law, medicine, architecture, sales and design. We hope that these opportunities will continue to grow into 2021
New EU trading rules
With the much-anticipated arrival of Brexit, new trade regulations and international laws will doubtlessly impact freelancers operating across Europe. Fortunately, the free trade agreement means there will be no taxes on goods. However, that does not mean that self-employed people living in the EU or working overseas will not be impacted. As of yet, there is little detail regarding the service sector, which accounts for about 80 per cent of the UK’s economy. This is something to keep an eye on as the UK begins its journey outside the EU in 2021.
IR35 reform in the private sector
The IR35 legislation reform is due to come into effect in the private sector on 6th April this year. The rules, which were delayed for a year due to the pandemic, will mirror the changes that were rolled out in the public sector in 2017. They will shift the burden of determining a contractor’s IR35 status from the individual to the hirer, leading to hefty fines if HMRC believes the hirer has incorrectly assessed a contractor’s IR35 status.
For this reason, some companies have stopped engaging independent workers. As a result, IR35 experts are advising contractors to speak to their clients in advance of the rules coming into effect to discuss their strategy for managing the reform.
With the UK’s deficit inflated to around £400 billion by the pandemic, the Treasury needs to raise funds in order to help repair the UK’s economy. Prior to the Chancellor’s Winter Economy Plan in September, there were rumours circulating that the self-employed could face numerous other tax rises, including National Insurance Contributions (NICs) and Capital Gains Tax. While these taxes have not been officially announced, they have also not been completely ruled out and freelancers should be wary of higher tax bills in the coming year.