***PLEASE IGNORE THIS REMINDER IF YOU HAVE ALREADY SENT US YOUR QUESTIONNAIRE***

We are fast approaching the deadline for filing your Self-Assessment tax return, which is Wednesday 31 January 2024.

If you would like Cogent to prepare your tax return, please complete and return the Self-Assessment Tax Return Questionnaire for the tax year 2022/23 as soon as possible.

As we are now very close to the key 31 January date, we cannot guarantee to complete the tax return to meet the deadline, so it is important that you complete the questionnaire as soon as possible.

Please also be aware that if we have already prepared your tax return, this will not be filed until our fee has been paid and the tax return approved.

Outstanding Balancing Payments for 2022/23 and the First Payment on Account for 2023/24 are also due and payable by 31 January 2024 and interest will be charged on late payment.

You can request a questionnaire for 2022/23 by emailing tax@cogentaccountants.co.uk

The standard charge, including VAT, for a basic tax return, is £240 as we have passed the deadline to receive this service at a discounted rate. Please note, more complicated tax returns, where additional work or supplements are required, will be subject to additional charges.

If you have a second shareholder, they may also need to file a tax return, even if they haven’t previously. For further advice, please contact our Tax Department.

Penalties for late filing of tax returns can be as much as £1,600, even when there is no tax due, so please ensure your tax return is filed on time, whether you ask us to prepare it for you, or you have made other arrangements.

Please return your completed questionnaire together with any attachments by email only to our Tax Department – tax@cogentaccountants.co.uk

You are required to file a tax return if:

• You have been asked to file one by HMRC
• You have a tax liability for the year (e.g. additional and higher rate tax, student loan in repayments, high-income child benefit charge or if you have any income which has not been taxed at source)
• You have a new source of income that needs to be declared.

***PLEASE IGNORE THIS REMINDER IF YOU HAVE ALREADY SENT US YOUR QUESTIONNAIRE**

In the wake of COVID-19, many industries saw a significant shift towards remote interactions, such as webinars.

However, as the world has emerged from the pandemic in recent years, in-person events are experiencing a vigorous resurgence.

Whether you like them or not, if you are a freelancer or contractor, attending key events is becoming increasingly beneficial, particularly in building and enhancing your roster of contacts and potential future contracts.

Expanding professional networks

One of the primary benefits for freelancers and contractors attending in-person events is the opportunity to expand their professional networks.

While virtual networking has its merits via platforms like LinkedIn, it often lacks the personal touch and depth of connection that face-to-face interactions provide.

In-person networking allows for more organic conversations, enabling freelancers to create more meaningful connections with potential clients, collaborators, and mentors.

These relationships can lead to new projects, collaborations, and even long-term partnerships, which are crucial for freelancers whose business growth relies heavily on a robust network.

Building trust and rapport

Attending events in person also facilitates the building of trust and rapport, which are key components of successful professional relationships.

Meeting someone face-to-face allows for a more comprehensive understanding of their personality, work ethic, and professional values.

This depth of understanding is often difficult to achieve through digital communication alone. For freelancers, establishing trust is vital, as it can lead to repeat business and referrals, which are important for sustainability in the freelance market.

Learning and development opportunities

In-person events often provide a range of learning and development opportunities. Workshops, seminars, and talks given by industry leaders can offer valuable insights and up-to-date knowledge, which is essential in the ever-evolving freelance market.

Such events also provide a platform for freelancers to discuss their own experiences and industry trends, share experiences, and gain new perspectives, which can enhance their practices and approaches to their work.

It may also expose contractors to new technologies, methods or strategies that allow them to deliver higher-value work with less effort. You only have to see recent developments in AI and automation to appreciate the impact that innovation is having on many industries.

Many of these technologies are demonstrated and launched at these events, allowing you to become an early adopter and gain a competitive advantage.

Increased visibility in the industry

Attending these events increases a freelancer’s visibility within their industry. Being present and engaging in industry discussions demonstrates a commitment to one’s field and helps in establishing oneself as a knowledgeable and active participant.

This increased visibility can attract potential clients who are seeking freelancers with a strong industry presence.

This is becoming more important than ever, as personal brand becomes a key tool in winning the best contracts and expanding your portfolio of potential contacts. Don’t be afraid to put yourself out there and up on the stage (both metaphorically and literally).

Access to new markets and trends

Finally, these events often bring together a diverse group of professionals from various sectors and geographical locations.

This diversity provides freelancers with access to new markets and emerging trends, which might otherwise be inaccessible.

Understanding these new markets and trends can open up opportunities for freelancers to diversify their services and expand their client base.

Choosing the right events for you

Understanding which events are right for you can take time and a little bit of research. We work with a wide range of industries, but here are a few events to consider based on industry type:

Oil and gas industry

• 20 – 22 February – Subsea Expo
• 24 – 28 June 2024 – Turbo Expo
• 21 – 22 May 2024 – Utility Week Live

IT

• 30 April – 2 May 2024 – National Cyber Security Show
• 10 -14 June 2024 – London Tech Week
• 29 – 30 August 2024– TechSpo London
• 18 – 19 September 2024 – Big Data LDN

Banking and Finance

• 6 – 7 March 2024 – MoneyLive Summit
• 21 March 2024 – UK Finance: M&A Conference
• 9 June 2024 – UK Investor Show
• 20 – 22 November 2024 – FIMA
• November 2024 – The Finance Professionals Show

Clinical Research

• 20 – 21 March 2024 – Ace Clinical Trials Summit
• 28 – 29 May 2024 – Global Clinical Trials Connect 2024
• 11 – 12 June 2024 – Annual Outsourcing in Clinical Trials UK and Ireland 2024
• 30 September 2024 – International Clinical Trials Methodology Conference 2024

The resurgence of in-person events offers a unique and valuable opportunity for freelancers and contractors to enhance their contact rosters.

These events provide a platform for meaningful networking, trust-building, learning, and increased industry visibility.

In an increasingly competitive freelance market, the benefits of attending these events can be significant in securing and sustaining a successful freelance career.

HM Revenue & Customs (HMRC) is now using new powers granted to them by the Government to target a key area of tax evasion – online traders.

It is not uncommon for contractors and freelancers to have a side hustle on platforms like eBay, Vinted, or Depop.

However, if you use these platforms, you must now be vigilant about your sales and income generated from them and other additional income, such as short-term lets on sites like Airbnb.

This is because HMRC now mandates these platforms to track and report sellers’ earnings. Operators may incur significant fines for non-compliance.

Effective from 1 January 2024, these rules also encompass short-term rental platforms like Airbnb.

With online selling being a popular means of supplementing income, these new rules could impact many if their earnings exceed a certain threshold.

Understanding the £1,000 allowance

The £1,000 allowance applies to employed individuals with an additional income source. This extra income often comes from irregular and casual activities, such as:

• Freelance writing or designing
• Crafting and selling handmade items
• Pet or house-sitting
• Tutoring

As these jobs are usually casual and might involve cash payments, many overlook the need to pay tax on these earnings, especially at the outset.

In the UK, there’s a £1,000 tax-free allowance for income beyond one’s primary job. Beyond this, you must register as self-employed and file a Self-Assessment tax return to declare your additional income and determine your tax liability.

Implications of the new regulations

For some, these changes won’t impact their earnings if they remain below the £1,000 limit and those regularly earning well above this threshold are likely aware and consistently submit a Self-Assessment.

However, those with earnings in-between should monitor their income carefully to see if it crosses the threshold.

Many individuals with ‘side hustles’ unknowingly omit e-trading income from their tax declarations or fail to submit a tax return altogether.

Therefore, all e-traders and side hustle participants should meticulously record their sales and earnings. This practice will help determine whether you need to pay tax on your income.

HMRC is cautioning contractors in the UK to stay vigilant against tax scams. This warning follows an alarming increase in fraud attempts, with over 130,000 tax scams reported between September 2022 and September 2023.

As the Self-Assessment deadline on 31st January 2024 approaches, taxpayers are advised to be particularly wary.

Last week’s announcement revealed that nearly half (44.6 per cent) of these scams involved tax relief schemes. These fraudulent activities vary in approach, ranging from false reminders to update tax details to threats of arrest for tax evasion.

With an estimated 12 million people completing Self-Assessment, the likelihood of scam attempts is expected to rise in the coming months.

This increase in fraud is attributed to current economic conditions. The Association of Certified Fraud Examiners’ 2009 report highlights a direct correlation between economic downturns and a rise in fraud incidents.

Myrtle Lloyd, Director General for Customer Services at HMRC, has urged taxpayers to be cautious of fraudsters as the Self-Assessment deadline nears. She warns that criminals often use emails, phone calls, and texts that mimic government messages to appear legitimate.

HMRC advises the public to be sceptical of unexpected contacts, which could be scams. Taxpayers are encouraged to check HMRC’s scam advice on gov.uk for guidance on identifying fraudulent schemes.

Over the past year, HMRC has already acted against 60,000 phone scams and removed 25,000 malicious web pages.

However, concerns persist due to recent reports of HMRC’s outdated IT systems being prone to cyberattacks and data breaches, potentially exposing taxpayer information to scammers.

HMRC has reported several data breaches to the Information Commissioner’s Office in recent years, indicating a growing risk.

To combat this threat, HMRC encourages the reporting of any suspicious tax-related communications. Texts claiming to be from HMRC can be forwarded to 60599, emails to phishing@hmrc.gov.uk, and phone scams can be reported on GOV.UK.

It is crucial to learn how to identify and report these scams to protect yourself, your company and sensitive financial information.

***PLEASE IGNORE THIS REMINDER IF YOU HAVE ALREADY SENT US YOUR QUESTIONNAIRE***

If you would like Cogent to prepare and file your 2022/23 tax return and you have not yet sent us your completed Self-Assessment Tax Return Questionnaire, you will need to do so by 31 December 2023 to benefit from our discounted fee.

If you have a second shareholder, they may also need to file a tax return, even if they haven’t previously. For further advice, please contact our Tax Department.

The standard charge including VAT for a basic tax return is £240. Questionnaires received by 31 December 2023 will receive a 50 per cent discount on the basic tax return, charged at £120.

Any questionnaires received after 31 December 2023 will be charged at the full rate of £240.

Please note, that more complicated tax returns where additional work or supplements are required, will be subject to additional charges.

Our deadlines have been set so that we can complete your return in time to meet the HM Revenue & Customs’ (HMRC) online filing deadline of 31 January 2024.

Penalties for late filing of tax returns can be as much as £1,600, even when there is no tax due, so please ensure your tax return is filed on time, whether you ask us to prepare it for you, or you have made other arrangements.

You can request a questionnaire for 2022/23 by emailing tax@cogentaccountants.co.uk

Please return your completed questionnaire together with any attachments by email only to our Tax Department – tax@cogentaccountants.co.uk

You are required to file a tax return if:

• You have been asked to file one by HMRC
• You have a tax liability for the year (e.g. additional and higher rate tax, student loan in repayments, high-income child benefit charge or if you have any income which has not been taxed at source)
• You have a new source of income that needs to be declared.

***PLEASE IGNORE THIS REMINDER IF YOU HAVE ALREADY SENT US YOUR QUESTIONNAIRE**

Going into the Autumn Statement, Chancellor Jeremy Hunt knew he needed to make an impact as the fate of the nation, and his own party’s electoral prospects rested on his 110 measures for business.

In delivering his “Autumn Statement for growth”, the Chancellor made several pledges that he said were designed to help those struggling with the cost-of-living crisis.

Against a backdrop of falling inflation and a fiscal buffer of up to £25 billion, thanks to HM Revenue & Customs (HMRC) growing tax receipts from rising incomes and frozen tax rates, Jeremy Hunt launched into a speech to Parliament full of tax cuts.

For sole traders and self-employed individuals, the Chancellor announced the elimination of Class 2 National Insurance Contributions (NICs).

Presently, self-employed people earning above £12,570 are required to pay a fixed weekly rate for Class 2 NICs, which was slated to increase to £3.70 from 6 April 2024. Additionally, the Class 4 NIC main rate will be reduced from 9% to 8%, further benefiting self-employed individuals.

Regarding pensions, the Government will maintain the Triple Lock, ensuring that the basic State Pension, the new State Pension, and the Pension Credit standard minimum guarantee for 2024-25 align with the average earnings growth of 8.5%.

The Government also plans to tackle the issue of “small pot” pensions by considering a lifetime provider model, which would allow pension contributions to be transferred to an existing pension scheme when changing employers.

This model aims to offer individuals greater control and insight into their pensions. Jeremy Hunt has proposed consulting on giving pension savers a legal right to direct new employers to contribute to their existing pensions, potentially adding an extra £1,000 a year in retirement for an average earner starting savings from age 18.

Finally, as previously indicated, the Government intends to abolish the Lifetime Allowance in the Autumn Finance Bill 2023, with this change taking effect from 6 April 2024.

However, beyond his speech, there was a critical measure hidden within the Autumn Statement documents, which marks a substantial change to the ever-important IR35 rules.

The document revealed that the issue of “double taxation” under IR35 regulations will finally be addressed.

The document says: “The government will legislate in the Autumn Finance Bill 2023 to allow HMRC to reduce the PAYE liability of a deemed employer to account for taxes paid by a worker and their intermediary on payments received where an error has been made in applying the off-payroll working rules.”

This form of “double taxation” typically arises when there is an incorrect determination of IR35 status. In such cases, HMRC attempts to recoup the tax liability from the party paying the fee.

However, this calculation does not consider the taxes already paid by the contractor, leading to HMRC collecting additional revenue.

Rectifying this issue will simplify the complexities associated with off-payroll rules and decrease the financial risk for end-clients and fee-paying parties engaging contractors.

Thanks to everyone who participated and took the time to recommend our services to their friends and colleagues.

The lucky winner is…

Paul Jeffers from Marton-in-Cleveland
in Middlesbrough

Paul is an Engineer by profession but when he isn’t at work, he enjoys nothing more than watching rugby. In fact, he even travelled to France recently to enjoy the World Cup in person to watch England get all the way to the semi-finals, narrowly missing out on the final with a last gasp defeat to South Africa.

However, his passion for the game doesn’t end there, as he has spent the last 10 years coaching his son and his team and can even be found on the rugby pitch himself from time to time.

Paul is also a keen cyclist and has taken part in many charitable bike rides, from Coast-2-Coasts, to Lands’ End to John O’Groats tours. This year, he even fulfilled a long-time goal of cycling across Europe!

We hope he will enjoy taking his new iPad on his next exciting adventure.

Paul has been a client of ours for over 15 years and not only has he received an Apple iPad, he will also soon be receiving £100 for the introduction of his family friend and colleague, who will also get £100 simply for joining Cogent!

Once again, thank you to everyone who took part in our latest giveaway, your support means a lot to our team at Cogent.

You can also triumph by introducing your acquaintances, colleagues and connections to us… stay tuned for our next Cogent referral promotion!

In the meantime, each successful referral you facilitate will earn you £100 — and the individual you refer will receive £100 as well!

If you are aware of an individual or company that could potentially benefit from our expertise and guidance, please click the link below.

Refer a friend to Cogent Accountants.

If you have any questions about the services we offer or our referral scheme, please feel free to contact us.

In the traditional employment model, salaries are generally predetermined, with little room for individual negotiation.

However, the landscape is dramatically different for contractors and freelancers, who have the unique ability to set their own wage rates.

This freedom comes with its own set of challenges, but for those who navigate it well, the rewards can be substantial.

In the final part of this running series, we look at how you can improve the amount you are paid for your work.

Being Selective of New Contracts

Unlike permanent employees, contractors and freelancers have the flexibility to be selective about the projects they undertake.

They can assess the scope, budget, and timeline before committing. Being choosy about the contracts they accept allows them to work on projects that align well with their skill set and financial goals.

Leveraging Expertise

Specialisation can make a significant difference in earning potential. The more expertise a contractor has in a specific field, the more valuable their skills become.

Clients are often willing to pay a premium for specialised skills, providing contractors with the opportunity to set higher wage rates.

Scarcity in the Jobs Market

Many industries are experiencing skill shortages, particularly in areas such as technology, healthcare, and engineering. Contractors with in-demand skills can leverage this scarcity to negotiate better contract terms and higher wage rates.

Negotiating for Better Pay

When it comes to negotiating pay rates, contractors have several advantages:

• Market research – Before entering negotiations, research the going rates for your industry and skill level. Knowing your market value gives you a strong foundation for discussions.
• Value proposition – Position yourself as a solution to the client’s problem. Make it clear how your specific skills and experience can benefit them.
• Flexibility – Some clients might have budget constraints that limit the hourly or project rate they can offer. However, that doesn’t mean the negotiation is over. You can propose value-added services or suggest a longer-term engagement to compensate for a lower rate.
• Be ready to walk away –The ultimate power in any negotiation is being able to walk away. If a client isn’t willing to meet your rate or compromise on other aspects like the project scope, it might be in your best interest to politely decline and wait for a better opportunity.
• Review Regularly – Market rates and your skill level are not static. Regularly review and, if appropriate, renegotiate your rates. Clients who value your work are often willing to discuss rate adjustments.

Being a contractor or freelancer provides the unique opportunity to set your wage rates, but this freedom comes with the responsibility of knowing your worth and the skill to negotiate it.

By being selective in choosing contracts, leveraging your expertise, and understanding the dynamics of the current jobs market, you can command the rates you deserve.

In recent years, Artificial Intelligence (AI) has made significant strides, transforming numerous industries and professions—including the world of contracting and freelancing.

Far from the dystopian narrative of machines taking over human jobs, AI is helping freelancers and contractors achieve more than ever before.

From automating mundane tasks to offering advanced solutions for complex problems, AI platforms like ChatGPT are turning into invaluable resources.

Streamlining administrative duties

One of the major advantages of AI for contractors is the automation of tedious administrative tasks. Systems can now handle a multitude of tasks including appointment scheduling and freeing up valuable time.

This allows freelancers to focus on what they do best – applying their specialised skills to deliver high-quality work.

Enhancing communication

Communication is key in any professional setting, and this is especially true for contractors who might work with international clients.

AI tools can assist with real-time translation and even draft emails, ensuring that language barriers are no longer an issue.

Complex problem-solving

Advanced AI algorithms can tackle complex problems by analysing data, predicting outcomes, and offering solutions—all at a speed no human could match.

Contractors working in fields like data science, engineering, or finance can leverage these capabilities to offer their clients cutting-edge solutions.

Aiding in skill development

AI platforms often include learning algorithms that can aid in skill development. For contractors looking to diversify their skill set, this is a particularly beneficial feature.

From learning a new programming language to understanding the intricacies of digital marketing, AI can accelerate the learning process, making freelancers more versatile and therefore more valuable to clients.

Negotiating rates and contracts

AI can also help freelancers during negotiations by providing real-time market rates, drafting contract clauses, or even simulating negotiation scenarios.

With AI’s data-driven insights, contractors can enter negotiations better prepared, helping them secure better terms and higher rates.

The future of contracting with AI

As AI continues to advance, its applications within the freelance and contracting sectors are bound to grow. AI might become so integrated into these fields that it could be considered a co-worker rather than just a tool. It’s an exciting prospect that promises to bring about even more opportunities for contractors to achieve more, earn more, and work more efficiently.

AI is revolutionising the contracting and freelancing sectors in the best possible way, making these professions more efficient, versatile, and profitable.

Platforms like ChatGPT are at the forefront of this transformation, offering a myriad of ways for contractors to optimise their workflow and offer superior services.

Far from threatening human roles, the rise of AI is setting us up for a future of unprecedented productivity and professional growth.