Intermediaries
Employment intermediaries: reporting requirements 5 June 2015
HMRC has updated their guidance about reports intermediaries may have to send to them for agency workers if they don't operate PAYE. The report template has also been updated.
An intermediary is any person who makes arrangements for an individual to work for a third party or be paid for work done for a third party. An employment intermediary is also commonly referred to as an agency.
From 6 April 2015, intermediaries must return details of all workers they place with clients where they don’t operate Pay As You Earn (PAYE) on the workers’ payments. The return will be a report (or reports) that must be sent to HMRC once every 3 months.
You don’t have to send HMRC reports if you are a UK employer and you:
supply workers to provide their services to end clients and nobody else is involved operate PAYE when you pay those workers
The reporting requirements and report template have updated content based on user’s feedback to make things clearer, and a link has been added to the summary of responses from the draft regulation consultation.
Employment Intermediaries and Tax Relief for Travel and Subsistence 10 July 2015
A consultation has been published - Employment Intermediaries and Tax Relief for Travel and Subsistence which sets out the government’s proposals for amending the rules for tax relief on travel and subsistence for those working through employment intermediaries. The government intends to remove workers’ eligibility for home to workplace travel and subsistence tax relief where they are engaged through an employment intermediary, such as an umbrella company or a personal service company (PSC), and are working under the right of supervision, direction or control.
HMRC also plan to hold roundtable discussions with stakeholders to improve understanding of the proposals and to help develop responses to the consultation on the proposed changes.
Responses to this consultation will be used by the government to finalise proposals with a further announcement planned at Autumn Statement 2015. This will be followed by publication of draft legislation, with changes to be introduced in the Finance Bill 2016 and implemented with effect from 6 April 2016.
CIPP comment The Policy Team will be studying the consultation, and if appropriate will issue a survey in due course.
IR35 discussion document 20 July 2015
As announced in the Summer Budget a discussion document has now been published to look at reforming the legislation on intermediaries.
IR35 legislation exists to ensure that those who work through intermediaries – usually Personal Service Companies – but who would have otherwise been direct employees pay broadly the same amount of income tax and National Insurance Contributions as direct employees. As the Summer Budget set out, government believe there is widespread non-compliance with the current rules and reform is needed to improve the effectiveness of the legislation. The government recognises that many individuals choose to work through their own limited company. However, where people would have been employees if they were providing their services directly, anti-avoidance legislation commonly known as IR35 (introduced in 2000) requires that they pay broadly the same tax and National Insurance as other employees.
CIPP Policy News Journal
25/04/2016, Page 310 of 453
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