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New legislation, introduced in April 2015, requires businesses which supply two or more workers to a client without operating PAYE to report details of payments made to HMRC on a quarterly basis.
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“Some employment intermediaries have been helping people to claim they are self-employed when they are not. The new rules will help HMRC crack down on people trying to bend the rules.”
People who supply workers can check guidance to see if the new rules apply and whether they need to send in a quarterly return. The first quarter April 6, 2015 to July 5, 2015 needs to be submitted to HMRC by August 5 2015 using HMRC's online services.
Personal Service Companies
Freelancers operating through their own limited companies will be exempt from this reporting requirement.
Section 2 of the HMRC guidance says:
Personal service companies
One-person limited companies, or personal service companies, that only supply a client with 1 worker don’t have to send reports to HMRC.
If the worker is supplied through an intermediary they will be included in the return of the intermediary that has the contract with the end client.
If a personal service company supplies more than 1 worker, including any subcontracted workers, it will be acting as an intermediary and will have to send reports for each reporting period.
Background
Intermediaries required to make a return must register with HMRC online services.
The intermediary responsible for sending the report to HMRC should include:
- their full name, address and postcode
- the worker’s personal details
- the engagement and payment details.
Some employment intermediaries will not need to make a return, because they pass on workers’ details to a different intermediary, who goes on to supply the staff required. The intermediary who has the direct contract with the business client should make the return to HMRC.
Details of the guidance is available here: What this means for an intermediary.
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Susie Hughes © Shout99 2015
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