I’m busy making a placement – give it to me in a tweet.
HMRC remove travel and subsistence expenses for #temporary workers. Recruiters need to engage with their suppliers to ensure #compliance.
I’ve got a minute between BD calls, tell me more.
The government first announced their intent to restrict travel and subsistence expenses in the 2014 Autumn statement. And we let you know about it back then. Since then there’s been much speculation, and while some of HMRC’s comms have been opaque, we’ve known the general direction of travel for a long time. Now that the draft bill is published, the stated policy objective is clear:
“The proposals are aimed at preventing workers, engaged through an employment intermediary, and their employers, from benefiting from relief for home-to-work travel expenses. It is an established principle in the UK tax system that people should not be able to claim relief on their regular commute from home-to-work, therefore this relief is not generally available to other workers.”
Compliance is key for the longevity of my contract desk, and I want to be able to inform my end-user clients. Give me the full detail.
Travel and subsistence expenses will not qualify for tax relief where the travel is “ordinary commuting” and where an intermediary is involved… Unless the worker is not subject to supervision, direction and control (or the right of). Tough new anti-avoidance measures are also in place. These include:
- Transfer of liability to the intermediary directors in the event that PAYE/NIC isn’t operated correctly
- Transfer of liability to anyone providing false documents around supervision, direction and control.
So the tone is clear – comply or be made personally liable. This, coupled with other debt-transfer measures and intermediaries reporting means that HMRC are getting serious about policing the rules.
Our MD, Jovan Pavlicevic responds to the changes:
“We launched forest at the end of 2011 in the teeth of the credit crunch, and the same month AWR went live. AWR which, of course, was the end of the world – or at least recruitment – and definitely umbrellas. Since then we’ve grown from one person to a team of over 20. Through AWR, through RTI, onshore and offshore intermediaries, intermediaries reporting, pensions and more.
Each one piled more cost in, and called into question the efficacy of temporary recruitment and more-so umbrellas… But the sectors continue to show strong growth and have played a large part in keeping the UK’s head above water through the GFC.”
Do you need to respond to the changes, retain margin, protect your and your client’s businesses, as well as keeping temps happy? Forest will help. Contact us now to book a meeting with an expert.