The Freelancer & Contractor Services Association (FCSA) and All Umbrella Companies Are Equal (AUCAE) have joined forces to speak out about the unfairness of the Apprenticeship Levy which could force some umbrella firms out of business.
FCSA and AUCAE believe that umbrella firms should be exempted from the levy, due to come into force in May 2017, because the majority of their payroll comprises contractors and freelancers. The levy will affect all companies with a payroll of £3m+ who will be charged at a rate of 0.5% of their wages bill.
The two trade bodies have got together to voice their concerns in response to the Government’s consultation which has just been issued after months of delay and has only given businesses and organizations three weeks to respond.
Said Julia Kermode, Chief Executive of FCSA: “It is very disappointing that Government policy makers have not listened so far and are pressing ahead regardless of the concerns voiced by many different parties. The Apprenticeship Levy as it stands is not fit for purpose and does not consider that some businesses have artificially high payrolls, like umbrella companies and recruitment firms. AUCAE and FCSA share similar goals and we are keen to work together for all our members to try and put the brakes on this ill-thought through legislation.”
Lucy Smith, founder of AUCAE added: “Our members are very concerned about the introduction of the levy and it is yet another cost to be borne by umbrella firms that could be very damaging for them. By joining forces with FCSA we hope that our combined lobbying efforts will be heard and that we can prevent the proposals being implemented.”