Updates to payroll legislation in April 2021 moved responsibility for determining the IR35 status of an assignment from the consultant to the end-client in the private sector. The fee-payer (end-client agency) is now responsible for ensuring that the correct income tax and National Insurance Contributions (NICs) are paid to HM Revenue and Customs (HMRC) where an inside determination is given.
What Does it Mean for You and Your Business?
Under the rules of the legislation there is an obligation on the end-client to ensure it has communicated the result of the determination (the SDS) to the consultant and the next party in the supply chain (normally the agency or service provider) to ensure that the relevant parties are aware of the result and so the correct tax treatment can be applied.
Failure to pass this information on could result in the end-client becoming liable for any taxes owed to HMRC arising from the assignment (this is referred to as the “provision of debt transfer” within the legislation). The financial implications of providing the IR35 determination without reasonable care, or of not passing the determination result to the relevant parties, are potentially significant. HMRC has the ability to require payment of back-taxes owed over a number of years in addition to any penalties and interest amounts accruing in the event that HMRC believes a determination has been arrived at incorrectly.
How We Can Help
Through our Contact Talent Solutions, we provide access to motivated and engaged people who apply their expertise and passion to your projects. Our Managed Talent Solutions offers added management support of our people and their performance to let you focus on what you do best. And when you require specific technical or operational expertise or an end-to-end solution, we provide comprehensive Engineering, Laboratory and Clinical Services to help you realise your vision and objectives.
Managed Talent Solutions
We offer a spectrum of outsourced services utilising specialist in-house project delivery managers, as well as subject matter expertise to ensure fast and effective delivery. We use best practices, methodologies, and tools to execute on the successful delivery of client outcomes. Services range from Project Led Managed Services to full outsourcing with an ownership of risk and project outcomes, including offshore solutions.
Contract Talent Solutions
Are you looking for an experienced partner in your supply chain to manage IR35 risk? Our Actalent PAYE engagement model is an ideal solution for our clients because it presents the least risk under the proposals for end-clients and all other parties in the chain.
We directly payroll 200,000 PAYE consultants on a weekly basis and therefore we already have the infrastructure in place to support payrolling significant numbers of consultants without the need for an additional 3rd party in the chain such as an Umbrella Company
Our existing permanent staffing teams have a significant presence across the pharmaceutical, life science and engineering industries partnering with a range of clients across UK to support their resource requirements. We are experienced in dealing with large volume recruitment campaigns, niche one-off hires and retained search. By engaging people permanently, our clients remove all IR35 risk.
Benefits of Engaging Actalent PAYE Consultants
Typically, recruitment agencies use umbrella company arrangements to pay the consultants they supply. This is because many companies and agencies do not have the infrastructure to payroll consultants themselves. Our global reach and extensive experience in payrolling consultants and consultants for many years has meant we have been able to invest in building out a robust internal payroll infrastructure, rather than relying on the services of umbrella companies. Some of the benefits we have already seen are as follows:
Reduced Supply Chain
Our direct PAYE offering means fewer parties in the contractual chain enabling better control of the supply-chain and associated risk s for clients.
Over the years, we have seen that our clients want to work with reputable agencies and want to distance themselves from payroll companies who historically have not always been 100% compliant with regulations. By operating our payroll in-house this means the risk of inappropriate payment practices is significantly reduced.
Enhanced Consultant Experience
By maintaining direct contact with our consultants, we are able to offer a superior consultant experience. Additionally, our extensive PAYE offerings include access to retail discounts, a specialised platform and dedicated points of contact.