A survey carried out by insurance firm Prudential has suggested that over half of self-employed workers would back plans to expand pensions auto-enrolment, or make pension saving compulsory.
According to the survey, 27% of those polled would support the expansion of pensions auto-enrolment to cover the self-employed, and an additional 27% would back compulsory pension saving.
The survey also revealed that 18% of self-employed workers ‘do not believe that pensions apply to them’, while 20% stated that they find pensions rules ‘very confusing’.
Furthermore, 28% of individuals surveyed reported that they will be reliant on the State Pension as their main source of retirement income.
Commenting on the survey, Vince Smith-Hughes, Head of Business Development at Prudential, said: ‘It is clear that the self-employed want help in saving for retirement and that the State Pension alone may not be enough for a comfortable retirement.
‘We believe it is important that the government works with the self-employed and the pensions industry to ascertain the most suitable option and put appropriate rules in place as soon as practicable.’
Research carried out by the Federation of Small Businesses (FSB) has suggested that confidence levels amongst the self-employed have ‘fallen significantly’ over the last year.
The FSB’s Small Business Index (SBI) for the UK’s self-employed community stood at +2.8 in the second quarter of this year – a significant fall when compared to the reading of +9.7 recorded in the first quarter of 2018.
The SBI also revealed that 28% of UK sole traders expect their business performance to worsen over the next three months.
To help boost confidence amongst self-employed individuals, the FSB has launched a new ‘think self-employed’ agenda, which urges the government to secure a Brexit deal that ‘works for sole traders’.
Commenting on the matter, Mike Cherry, National Chairman of the FSB, said: ‘The UK’s self-employed community contributes more than £270 billion to the economy annually, yet they’re still treated as an afterthought by policymakers.
‘The self-employed need to be front of mind for Brexit negotiators. We must avoid a future scenario where our contractors have to fill out burdensome paperwork when completing jobs in Europe. Any Free Trade Agreements struck after 2020 need to include dedicated small business chapters to ensure firms of all sizes, including sole traders, benefit from new arrangements.’
A study carried out by mortgage lender Kensington Mortgages has suggested that a significant number of the UK’s self-employed workers are ‘unfazed’ by Brexit.
Kensington Mortgages surveyed more than 1,000 self-employed individuals, and found that 63% believe that Brexit will have ‘no impact’ on their business.
However, in terms of Brexit’s impact on the UK economy, 52% of the self-employed individuals polled believe that the economy will be adversely affected.
Meanwhile, 47% of those surveyed expect 2018 to ‘bring in more work’ than 2017, and 42% are confident that they will make more money this year than last year.
The study also revealed that 35% of self-employed workers believe that Brexit will make it harder to obtain a loan, with sole traders and freelancers expected to be amongst those worst affected.
‘Self-employed workers are, without a doubt, the backbone of the UK economy, so we should all take reassurance from their optimistic outlook and ability to build up their savings to cope with life’s unexpected events,’ said Craig McKinlay, Sales and Marketing Director at Kensington Mortgages.
‘The fact that such a diverse group of workers would have diverging views on Brexit is unsurprising. What is perhaps more important is how we respond to these concerns. Regardless of regional location, business size or age, the self-employed have unique day-to-day circumstances that unite them.’
A survey carried out by AXA Business Insurance has revealed that a significant number of self-employed individuals believe that working for themselves has ‘improved their quality of life’.
82% of those polled believe that being their own boss has enhanced their quality of life, whilst only 7% believe that working for themselves has negatively impacted on their quality of life.
The survey also suggested that, in regard to mental health in the workplace, just 40% of self-employed individuals experience work-related stress, compared to 60% of those in regular employment.
However, when it comes to starting up in business, the survey revealed that many UK entrepreneurs struggle with their self-confidence: 50% stated that they lack confidence, while 22% reported that mental health issues hold them back from pursuing their business goals.
Commenting on the findings, Gareth Howell, Managing Director of AXA Insurance, said: ‘Some people are attracted to self-employment as a route out of a damaging workplace situation. Whatever your motivation, timing is crucial to success or failure in self-employment.’
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HMRC has recently launched a Making Tax Digital (MTD) pilot for income tax for self-employed taxpayers. This is currently open to sole traders with income from only one business, whose current accounting period ends after 5 April 2018.
To take part in the pilot, sole traders will need to send income and expenses summaries to HMRC every three months using MTD-compliant software. A final report to confirm all income and expenses for the year and to claim any allowances or relief the business may be entitled to will also be required.
Currently, only two software providers are included on the list of those that support the MTD for income tax pilot. This can be found on HMRC’s website – https://www.gov.uk/guidance/software-for-sending-income-tax-updates, and will be updated as more become available.
MTD for income tax is not set to take effect until 2020: the government has confirmed that keeping digital records and making quarterly updates will not be compulsory for taxes other than VAT before April 2020.
Meanwhile, the MTD for VAT pilot starts next month, before being mandated from April 2019.
Research carried out by banking group Aldermore has suggested that a significant number of UK workers are planning to become self-employed in the future.
Aldermore found that 29% of individuals aim to become self-employed – a notable rise when compared to 2017’s figure of 15%.
15% of workers plan to launch a business in the retail sector, whilst an additional 11% plan to move into the catering and accommodation industry.
18% intend to make the move in the coming year, the research suggested.
Aldermore found that economic uncertainties ‘don’t seem to be a concern’ to entrepreneurs, with 53% stating that Brexit negotiations will have ‘little impact’ on their business.
However, the research also revealed that 70% of workers believe it is harder for the self-employed to secure a mortgage.
Commenting on the findings, Charles McDowell, Commercial Director for Mortgages at Aldermore, said: ‘The research demonstrates that the UK is a truly entrepreneurial nation, with nine million people considering making the ambitious move to become self-employed.
‘It takes a lot of courage to make the major life decision to become self-employed, and it is encouraging to see almost three in ten expect their revenues to increase in the next 12 months, which is a positive outcome in light of the myriad of uncertainties.’
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Research carried out by banking group Aldermore has suggested that a lack of business savings is putting a strain on self-employed individuals in the UK.
Aldermore’s data suggested that poor business resilience is putting sole traders and freelancers ‘at risk of financial hardship’.
It found that 22% of individuals have no business savings at all, whilst 40% revealed that their business has less than £1,000 in cash savings.
An additional 54% of self-employed individuals stated that they have been unable to earn money due to ‘unforeseen events’, with many citing ill health as being an issue.
Aldermore’s research also revealed that 8% of firms with a turnover above £50,000 hold nothing in cash.
Ewan Edwards, Head of Savings at Aldermore, commented: ‘Starting a new business is a significant life decision. While many self-employed people relish greater flexibility and control, the first few years can often bring long hours, additional stress and relatively small financial rewards.
‘We want to work with the government to look at means of backing Britain’s entrepreneurs and helping them devise new policies and financial products that will encourage start-ups and protect growing small businesses from the shocks and uncertainties of self-employment.’