Few in the recruitment industry seem to believe the new Onshore Intermediaries legislation is either fair or proportionate to the recruiters identified in the legislation as “Agency 1”. However, for now, that argument has been lost and we are in a new era where the burden of proving that workers are self-employed has shifted from HMRC to the recruiter.
This simple change allows HMRC to issue debt notices where they believe workers are not genuinely self-employed and there may be a shortfall in payments of tax and national insurance contributions. The debt will have to be paid within 30 days of issue, even if the recruiter thinks the notice is incorrect. These debt notices will be issued to the recruitment company and where they fail to pay the burden will move to the recruitment company’s directors. Whether we agree with the legislation or not there is little doubt this threat of liability is proving to be an effective wake-up call.
Previously recruiters did not have to worry about supply chain compliance, beyond the concern over reputational damage, but now the penalties of non-compliance are so high that robust preferred supplier lists are essential and those thinking that the defence of fraud will get them off the hook are sadly out of touch with the legal process.
I understand that some recruiters operating in the low paid sector are turning to specialists to develop new schemes and test the viability of old renamed schemes in an attempt to avoid the new legislation. Developing a scheme specifically aimed at avoiding legislation cannot and should not be viewed as ‘compliant’. When my company, Orange Genie, talk about compliance we mean we comply with all current legislation, including tax legislation. I believe legislative compliance is something we are and not something we do.
Posted by Orange Genie on 24-Apr-2014 12:19:00 0 Comments Read More
Topics: Orange Genie Group, EDM