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Secure self-employment campaign latest news

Objective 1: Self-employed people have the same simple systems as employees to encourage them to save for retirement. We want self-employed people to have access to, through opt-in, a pensions scheme during a self assessment review.

What has happened? Lifetime ISAs were announced in the March 2016 Budget.

These provide government contributions to incentivise self-employed people, who do not have access to employer’s pension contributions, to save for their retirement or to buy their first house. However, these will only be available for those under 40, while an increasing number of self-employed people are older.

Objective 2: Self-employed parents are better supported to balance family life and work. We want self-employed parents to receive similar support to employees in measures including parental and adoption pay and leave.

What has happened? Maternity pay equalisation between self-employed and employee mothers was included as a recommendation in the recent Julie Deane Review of support for self-employed people PDF commissioned by BIS.

Objective 3: Self-employed people are not disadvantaged by reforms to income tax and national insurance.  We want self-employed people to benefit equally from the government’s planned reforms to to income tax and national insurance.

What has happened?  The March 2016 budget contained announcements that class 2 national insurance contributions for self-employed people would be abolished in  April 2018 and that recommendations for the Office of Tax Simplification’s review of tax and national insurance alignment would be taken forward PDF .

Objective 4: Newly self-employed people have specialist and flexible support to allow their business to develop to its full potential. We want specialist advisors for self-employed people, who can decide when a business has been given sufficient time to develop before applying payment caps to their Universal Credit (the Minimum Income Floor).

What has happened?  Announcement in March 2016 Budget that better business support for self-employed people currently on Tax Credits is to be piloted and if successful extended to Universal Credit.

Objective 5: No employee is forced into self-employment or wrongly classed as self-employed. We want definitions of employment status to be simplified across departments and clearer guidelines around self-employment on job adverts.

What has happened? Government commitment to cross-departmental review of employment status announced PDF . Citizens Advice research cited as  reason for Gumtree improving its online job advert site.

And what have we done to push for each campaign objective?

Objective 1: support to help self-employed people save more for their retirement

We’ve published our research, ‘Shy of retiring’, on the barriers self-employed people face in saving for retirement and made a number of recommendations to improve this.

Our Senior Policy Researcher, Thomas Brooks, presented our evidence: that self-employed people should have access to, an opt-in pensions scheme at the time they complete their HMRC tax self-assessment form and that government should match pensions contributions up to a level of 1% of gross earnings to incentivise those on low incomes, including the self-employed, to save into a pension

at the Department of Work and Pensions Select Committee on pensions auto-enrolment.

“Now we’ve got [pension auto-enrolment] up and running for employees, we have 4.6 million people who aren’t eligible, so we need to look at how to bring them in as a matter of urgency.” Thomas Brooks, Citizens Advice

We are continuing to engage with HMRC’s consultations on digital tax and national insurance reporting PDF .

Objective 2: support for self-employed people to balance family life and work

We’ve published our research, ‘Who’s the Boss’, which makes recommendations to support self-employed people to better balance family life and work.

We worked with the Federation of Small Businesses and the RSA to host a small roundtable that used our evidence on self-employment to inform the Julie Deane Review on support for self-employed people commissioned by BIS.

Our pre-budget ask for equal maternity, paternity and adoption rights between self-employed people and employees was covered in the Mirror newspaper.

“Our research shows 63% of self-employed mums take less than a week off after their baby is born. The Budget is a great opportunity to offer parents who work for themselves similar support to that which employees receive.” Gillian Guy, Chief Executive, Citizens Advice

We will continue to work with the RSA, FSB and Gingerbread to deliver more changes to support self-employed people to better balance their work and family life.

Objective 3: a fairer tax and national insurance system for self-employed people

We submitted a response to OTS review of IT and NIC alignment [PDF 1 mb] to the Office of Tax Simplification’s review of tax and national insurance alignment

The final Review contains two Citizens Advice response recommendations:

more closely aligning the national insurance contributions for the UK’s 4.7 million self-employed with that of employees and help to make national insurance contributions a more transparent system, as well as our recommendation of aligning tax and national insurance reporting for self-employed people with HMRC’s digital reporting agenda

We submitted NICs consultation response [PDF 290 kb] to the Government’s consultation on abolishing Class 2 and reforming Class 4 National Insurance Contributions.

Margaret Hodge, MP, also asked to see our submission to the Office of Tax Simplification review, to support her current work on reviewing tax relief.

We are currently working with the Department of Work & Pensions and HMRC to report on the impact of the new strengthened self-employment test on people claiming Working Tax Credits introduced in April 2015.

Objective 4: more support to self-employed people to enable them to develop their business to its full potential

We have been asked to be part of the Department of Work & Pensions Universal Credit for self-employed people Working Group. Our evidence will help to inform implementation of Universal Credit for self-employed people, informed by the evidence submitted by local Citizens Advice on the new self-employed test for Working Tax Credits.

We are supporting local Citizens Advice to map support for self-employed people in their area to inform this work.

We have published research on self-employed people and debt, ‘Going for Broke’, and will work with the financial sector and co-operatives & mutuals to discuss how we can take forward our recommendations.

Objective 5: reducing bogus self-employment

We are developing more resources for local Citizens Advice to recognise bogus self-employment and support those affected by it.

We will continue to work with the Office of Tax Simplification to try and simplify cross-departmental definitions of employment status.

We have engaged with the Gangmasters’ Licensing Authority, who now have a widened remit PDF , to ensure that we can link them up with intelligence on bogus self-employment, as well as other employment rights issues, from our local Citizens Advice.