Self-Employment – How the Onshore Intermediaries Legislation affects our agency workers
As of April 2014, HMRC introduced legislation called The Onshore Intermediaries Act, which addresses instances of false self-employment. It is one of many measures introduced by HMRC in recent years to combat tax and National Insurance avoidance.
Onshore Intermediaries Legislation
From April 2014, any temporary worker working through an employment intermediary (defined as a company sitting between the client and worker, including employment businesses) will be deemed employed for tax and NI purposes UNLESS that intermediary can demonstrate that the individual is not subject to (or to the right of) direction, supervision and control.
Our HMRC Reporting Requirements
Since August 2015, we, and other recruitment agencies, have been required to submit a quarterly report to HMRC detailing all payment to individuals not otherwise accounted for by our own RTI (HMRC) submission.
These quarterly reports include details of all payments made to self-employed workers supplied on a direct basis, umbrella PAYE workers and PSC workers (e.g. if outside of IR35).
HMRC enforcement will be based on the information submitted via the quarterly returns. If agencies are continuing to report high levels of self-employed workers, HMRC may well investigate to establish how genuine those arrangements are.
How does this affect you?
Whether or not a temporary worker is under the supervision, direction or control of any person will always depend on the circumstances of the assignment, the nature of the role and the seniority of the individual concerned.
However, ultimately it is our clients who confirm the assignment details and in the vast majority of jobs we work on within a hospital or medical surgery setting there is always some level of control of your day-to-day activities regardless of your grade. The HMRC’s employment status manual confirms this position on agencies supplying doctors to hospitals - click here to read more.
The requirement for the temporary worker to be under the client’s supervision, direction and control is also clearly stated in the NHS Frameworks under which we supply agency workers.
Therefore, Anaesthetists Agency has taken the decision not to pay our agency workers as “self-employed” and therefore you cannot be paid gross (without NI and tax deductions).
You can be paid in the following ways when working as an agency worker for Anaesthetists Agency:
• PAYE directly through Anaesthetists Agency
• Through an umbrella company who will make PAYE deductions
Please do also review our note on the use of umbrella companies and what to be aware of - locum doctors.
• Through your own Personal Service Company (PSC)*
Please be aware that a PSC is also considered an “employment intermediary” and is subject to the same test above, and also note the requirement for public bodies to determine IR35 status of PSCs since April 2017. We have provided more detailed guidance on IR35 legislation - changes for PSC workers April 2017
If you have any queries in relation to the above, or wish to discuss the status of a particular assignment, please do contact accounts@aalocums.co.uk.
Onshore Intermediaries Legislation
From April 2014, any temporary worker working through an employment intermediary (defined as a company sitting between the client and worker, including employment businesses) will be deemed employed for tax and NI purposes UNLESS that intermediary can demonstrate that the individual is not subject to (or to the right of) direction, supervision and control.
Our HMRC Reporting Requirements
Since August 2015, we, and other recruitment agencies, have been required to submit a quarterly report to HMRC detailing all payment to individuals not otherwise accounted for by our own RTI (HMRC) submission.
These quarterly reports include details of all payments made to self-employed workers supplied on a direct basis, umbrella PAYE workers and PSC workers (e.g. if outside of IR35).
HMRC enforcement will be based on the information submitted via the quarterly returns. If agencies are continuing to report high levels of self-employed workers, HMRC may well investigate to establish how genuine those arrangements are.
How does this affect you?
Whether or not a temporary worker is under the supervision, direction or control of any person will always depend on the circumstances of the assignment, the nature of the role and the seniority of the individual concerned.
However, ultimately it is our clients who confirm the assignment details and in the vast majority of jobs we work on within a hospital or medical surgery setting there is always some level of control of your day-to-day activities regardless of your grade. The HMRC’s employment status manual confirms this position on agencies supplying doctors to hospitals - click here to read more.
The requirement for the temporary worker to be under the client’s supervision, direction and control is also clearly stated in the NHS Frameworks under which we supply agency workers.
Therefore, Anaesthetists Agency has taken the decision not to pay our agency workers as “self-employed” and therefore you cannot be paid gross (without NI and tax deductions).
You can be paid in the following ways when working as an agency worker for Anaesthetists Agency:
• PAYE directly through Anaesthetists Agency
• Through an umbrella company who will make PAYE deductions
Please do also review our note on the use of umbrella companies and what to be aware of - locum doctors.
• Through your own Personal Service Company (PSC)*
Please be aware that a PSC is also considered an “employment intermediary” and is subject to the same test above, and also note the requirement for public bodies to determine IR35 status of PSCs since April 2017. We have provided more detailed guidance on IR35 legislation - changes for PSC workers April 2017
If you have any queries in relation to the above, or wish to discuss the status of a particular assignment, please do contact accounts@aalocums.co.uk.
