Avoiding corporation tax

There’s been a lot of hot air spouted this week about tax and the self employed, but what about the big boys? You know, the big corporations who make billions and can afford to pay clever accountants and lawyers the rest of us can’t even dream about instructing…

Here’s a round up of what’s going on – and it’s by no means exhaustive :

Caffe Nero : UK sales £274 million CT nil
Vodafone : UK sales £2.7 billion CT nil
Gap : UK sales £426 million CT nil
Waterstones : UK sales £395 million CT nil
EE : UK sales £6.3 billion CT nil

And there is a whole list of other big companies who pay some CT but nowhere near anything proportionate to their sales or real profits. Companies like Apple, Boots, Starbucks, Vision Express…

The list goes on and on, so maybe it would help defuse the row over the taxation of the self employed if the Chancellor was seen to do something about fairness in taxing the big boys as well as the little man?

Fairness shouldn’t be selective…

You’re NICked…

First of all let me declare an interest : I spent the best part of the last 20 years of my working life as a self employed contractor in the IT industry. I’m also a chartered accountant so I was particularly interested in what the Chancellor had to say yesterday about National Insurance contributions.

There’s been a lot of nonsense spouted by various self employed people over yesterday’s announcement, not least of all by one particular blogger – whose blog I’m banned from accessing – that I read this morning (working well, that ban, isn’t it?) who simply doesn’t seem to understand the situation at all, frankly. However, in the interests of fairness, you can read his slant on all this here even if I’m not allowed to! (sic.)

What the Chancellor has done is to abolish Class 2 NICs and incorporate that saving into the Class 4 NIC. The Class 4 NIC has then been increased by 1% this year and a further 1% next year.

The bleat from the people who don’t like this seems to revolve around around their employment rights. The self employed have no employment rights, so the argument is irrelevant. The government provide the NHS and a state pension in return for NI. Here’s an important point : The State Pension has been changed so that self employed people now have the same pension rights as employees. They also have the same access to the NHS, so why should they pay less?

Even after these changes, the self employed still pay a lower NI contribution that employees whilst getting the same access to the NHS and the same pension rights. Employees pay 12% compared to the current Class 4 rate of 9%. Over £43,000 p.a. everyone pays 2%.

The net effect of the changes is that self employed people earning under £28,000 per annum will pay less NI. From £28,000 to £43,000 they will pay the same. Over £43,000 they will pay more.

This seems fair to me. Maternity rights, sick pay and paid holidays are not the responsibility of the government. When I worked as a self employed contractor, I earned more than I would have done as an employee. This was precisely because I had to earn enough to cover unpaid holidays, sickness, gaps between contracts and the like.

There is a class of people in this country and others who believe that things should be given to them as a right and that they shouldn’t have to contribute in order to get them. My fellow blogger’s rant calling the government ‘thieving scum’ and the taxman a ‘blood sucking leech’ shows a fundamentally bad attitude and is typical of the ‘something for nothing’ mentality. I won’t bother to argue the case with him because that would be like trying to teach a pig to sing.

The case for this change is clear. It’s about fairness. If you want the same rights, then you should pay the same contributions towards them. And, at the end of the day, nobody forces you to become self employed. It’s a choice for you as it was for me and I fail to see why there should be a financial incentive funded by employed people for you to do so…

Blondeman rides again!

What can we say about Heseltine’s appalling stance against Brexit in the Lords?

Well, here’s a bit of Spitting Image made when he wanted to become the next PM – gawd help us! It really says it all about his attitude towards the ordinary voter!

May did the sensible thing and ignominiously sacked him from his cushy little advisory jobs with the Tories. Good riddance to bad rubbish!

It really is time the Lords was replaced with an elected Senate. I propose 400 members elected every 4 years with 200 elected at a time and two years spacing between elections. The changing composition might then actually reflect some semblance of public opinion? Well, I can hope so anyway!

One Lord down, only 799 more of the decrepit buggers to go. Bring it on…

Gobshite for England

A Smalltown Man post…

Here in Smalltown we’re very proud of our heritage. Oh, yes! Nobody is quite as proud of their heritage as us…

And that’s why we’re waging a campaign to unseat St George as the patron saint of England and replace him with our very own St Gobshite. So why do we feel so strongly about this? Well, the legend of Gobshite tells it’s own story.

Back in medieval times, Flatland was ruled over by the mighty King Flaxen of the Tiptonites who supressed the people with an iron hand whilst keeping the other for feeding his face and fondling the serving wenches. Gobshite, the rightful King of Flatland, raised an army to throw off the yoke of oppression. Around 823 – or just after breakfast – Gobshite’s army joined into battle with the Tiptonites, but despite superior numbers they reckoned without the state of the art weapon of the day, the mighty Tipton longbow – and they were put to flight.

King Gobshite having a really shit day...

King Gobshite having a really shit day…

Flaxen pursued Gobshite and captured him. He was unceremoniously tied to a tree and executed by Flaxen’s archers. Legend has it that Flaxen’s pet wolf, Eingar, stole Flaxen’s golden crown, placed it beside the martyred Gobshite’s body and stood vigil until his people retrieved the body and incarcerated it here in Smalltown.

So moved was Flaxen at this miracle that, after slaying and eating the wolf, he converted to Christianity, handed power back to the Flatlanders and retired to live a pious life of poverty in a simple mud hut in Northland where he remained until his dying day.

Gobshite was later canonised by Pope Pompous II around 1155 or just before lunch. Ironically Flaxen was posthumously awarded the Kings Award for services to Archery.

Clearly, the unbelievable story of St George and the nonexistent Dragon cannot be taken seriously so we believe that the rightful King Gobshite of Flatland, first King of England and Christian martyr must take it’s rightful place. Oh yes, we do!

And did I mention that we’re very proud of our heritage here in Smalltown?

Vanity publishing

They say everybody has at least one book in them itching to get out, so how do you get it out there? I know a couple of well known bloggers who have written books, so out of interest I thought I’d take a look…

For many years – and certainly before the digital revolution and eBooks – authors have been self publishing. Mark Twain, for example, did just that. The costs however can be prohibitive so the so-called ‘vanity publisher’ appeared on the scene. These less than scrupulous people preyed on authors sick of getting rejection letters, offering to publish their books in exchange for contributions towards costs. More often than not, these costs were considerable and the services offered in exchange minimal. Basically, they were exploiting the vanity of the author, hence the label.

In addition, you need to ask yourself whether you are signing away a proportion of your royalties because, in general, if you are then you’re probably being exploited. If they have your money and the book sells, they make a good profit. If the book doesn’t sell, then you’re the one out of pocket. If they’re not marketing or promoting your product, then why are they charging for it? It’s a reasonable question and a win/win for them not you.

Vanity publishers should not be confused with genuine companies who offer editing, proof reading, design, ISBN registration and other genuine services in exchange for a fee. These processes can be expensive, complex and time consuming so you are being offered a genuine service in exchange for your money.

Now, of course, it is possible to do it all yourself and sell digitally on line. This keeps costs to a minimum and makes your book available to a huge potential market – provided your seller knows it exists. Amazon is the obvious choice for your eBook. You can get it on there for a reasonable cost and the returns are potentially enormous – or, indeed, non existent if nobody buys it. But beware of the main pitfall of eBook publishing. Piracy.

Books are no different to music in that respect. Loads of people out there will download your book without paying for it. My friend Chas C has the same problem with music. He has several albums on Amazon, iTunes and other sites. He doesn’t make much from them but is proud of the fact that he’s got a couple of albums heavily pirated throughout Russia and Portugal on download sites. He’s about £10,000 out of pocket on what he would have got if the downloaders had bought them. Of course, not everyone who grabbed it for free would have parted with cash for it.

So if, like him, your attitude is to spread your work for the artistic pleasure you get from it rather than the money, then digital could be the way to go. On the other hand, if you need the money…

It’s a minefield alright, but if you want to give it a go, I wish you all the very best.