1. Adrian Dixon / Robert Burton Employment Intermediaries Policy Leads, HMRC

2. Onshore Employment Intermediaries Summary of Changes The new legislation strengthens existing legislation relating to employment agencies by removing the obligation for personal service. The concept of an agency contract has also been removed from the legislation. The legislation focuses on whether the worker is subject to, or the right of, supervision, direction or control as to the manner in which the duties are carried out. Control for the purposes of the new legislation will means that anyone able to exercise control, or have the right to exercise control about how the work is carried out.

3. Onshore Employment Intermediaries Summary of Changes Cont. Where a worker is engaged by or through an intermediary there is a presumption that there is control over the worker. Where an intermediary does not think that there is supervision, direction or control (or the right of supervision, direction or control) over the worker, there is now a requirement for them to keep or have access to documents or information to evidence this. If the intermediary is unable to produce satisfactory evidence when requested by HMRC, then HMRC may recover tax and NICs from the intermediary, i.e. the liability sits with the intermediary. Record keeping and return requirement is being introduced from 6 April 2015 with the first return due by 5 August 2015. This requires intermediaries supplying workers to an end client to provide HMRC with details of all of those workers who they are not deducting income tax and NICs from at source.

4. Offshore Employment Intermediaries Legislative Changes introduced in FA14 Amendment to s689 ITEPA 2003 to clarify who is responsible for operating PAYE when the worker is supplied to an end client via a UK agency Amended the Social Security (Categorisation of Earners) Regulation 1978 to ensure that there is a Secondary Contributor where a worker is employed offshore and working in the UK or is being supplied by or through an offshore agency. International secondees, where the existing legislation already works well, the rules have remained as they are currently. As with onshore a record keeping and return requirement is being introduced from 6 April 2015 with the first return due by 5 August 2015. This requires intermediaries supplying workers to an end client to provide HMRC with details of all of those workers who they are not deducting income tax and NICs from at source.

5. Offshore Employment Intermediaries Oil & Gas The legislation for the oil and gas industry differs from the offshore as it recognises the unique characteristics of the industry. This is: Where the offshore employer has an associated UK company it is the UK associate who is the Secondary Contributor and responsible for operating PAYE and making returns under RTI Where there is no UK associate it is the licensee of the oil field who is the Secondary Contributor and responsible for operating PAYE and making returns under RTI. We have also introduced a certification scheme where: -the licensee is the Secondary Contributor and responsible for making returns through RTI -the offshore employer is actually making these payments. This relieves the licensee of their responsibilities for the duration that the certificate is in force. HMRC will not be able to pursue the licensee where a certificate a valid certificate is in force.

6. Record Keeping Requirements

7. INTERMEDIARY REPORTING DATA SET Specified employment intermediaries An employment intermediary is a specified employment intermediary if at any time during a tax quarter— –(a) the employment intermediary is an agency, –(b) more than one individual provides services to a client under or in consequence of a contract between the employment intermediary and one or more clients, –(c) those services are not provided exclusively on the UK continental shelf, and –(d) one or more of the individuals would have been agency workers, but for section 44(2) of ITEPA.

8. INTERMEDIARY REPORTING DATA SET (proposed in technical consultation) -In respect of the employment intermediary making the return— (i)name (ii)address (iii)postcode (iv)PAYE reference number - In respect of each individual (i) their (aa)title, (bb)full name (cc)date of birth, (dd)address, (ee)postcode, (ff)gender, (gg)national insurance number (if they have one), (hh)Unique Taxpayer Reference (where self-employed or payments are made to a partnership), (ii)passport number or identity card number (if the worker is not a British citizen), (ii)the date on which the individual began providing the services (iii)the date on which the individual stopped providing the services (iv)the number of hours worked by the individual for each client in the relevant period; In respect of payments made by the employment intermediary in relation to services provided by an individual— (i) in respect of the person receiving the payment their— (aa)full name (if the recipient is a registered company their company name or if they are a partnership the name under which they are trading), and (bb)address. (ii) the total amount of all payments made by the agency to the person in the relevant period, (iii) the reason why the agency has not deducted income tax from those payments, (iv)where the reason is that the payments made are to a limited company the company registration number, (v)whether the payments made included amounts in respect of Value Added Tax.