2012 was a challenge for everyone so after weathering the storms and surviving the excesses of the festive period now is probably a good time for recruitment agencies to check up on their wellbeing.
It’s time to book a SPA.
A Lawspeed SPA may not offer you full use of an indoor pool, a complimentary massage or yoga but it can deliver inner peace to recruitment agencies and purge you from the risk of tax debt transfer.
The unique Service Provider Audit (SPA) from Lawspeed is entirely free for recruitment businesses and there’s no catch.
Sounds too good to be true? Here’s the science bit:
• Many agencies are unaware that they may be liable for the tax debt of contractors when they deal with non-compliant umbrella companies and other service providers.
• In 2007 Managed Service Companies (MSC) Legislation was introduced in an attempt to collect tax when there is a central ‘provider’.
• The consequence of this legislation is that MSCs treat all payments received by workers providing their services through such companies as income subject to PAYE and Class 1 National Insurance Contributions.
• All service providers claim to be compliant with the MSC legislation, but some are not.
• If the MSC has incurred tax debt this can be ‘transferred’ to the agency which recommended them – leaving the agency liable to pay.
• Agency Directors can be held personally liable.
HM Revenue and Customs has stated that agencies cannot rely on assurances from services providers and last year the Taxman increased his investigations into MSCs by a staggering 300% with the number of debt transfer notices rising at a similar rate.
Lawspeed’s legally qualified staff can review the arrangements your recommended suppliers have in place and report back to you on the level of risk.
Costs are passed on to the service providers who benefit from showing transparency and compliance with the MSC rules.
It’s a fat-free, win-win situation with agencies receiving an updated safe Preferred Supplier List and complete peace of mind.
Take a deep breath, feel your shoulders relax and visualise a future free from the risk of transferred tax debt.
Adrian, a highly experienced lawyer, founded Lawspeed in 1997. He is responsible for developing our extensive portfolio of products and services, including the widely used Lawspeed contract templates. Adrian is an expert on “recruitment law” and specialises in contracts, regulatory compliance, employment status and dispute handling. He is chair of the trade body the Association of Recruitment Consultancies, the only lawyer lead recruitment trade body in the UK. Adrian and his co-director Ravi devised Standards in Recruitment as a vehicle for helping drive up standards and compliance in the industry.
Adrian is our lead in discussions with the government over regulatory evolution. Apart from assisting with client support, Adrian’s primary role is research and development into methods of business delivery, our latest service Proterms being his most recent project. Adrian heads our IR35 lawyers team.