Agency User Guide:
Changes in HMRC Reporting
Regulations and guidance on the reporting requirements for agencies that place temporary
workers have now been released, adding yet more workload to your business.
The changes, introduced by the HM Revenue and Customs apply from 6th April 2015.
The HMRC introduced the changes after identifying two areas for concern:
•
Recruitment agencies paying workers on a “false” self-employment basis
• Supplied UK workers from an offshore location avoiding paying full PAYE
income tax, and national insurance contributions for temporary workers.
In order to help agencies prepare, Candor has
produced this comprehensive user guide.
Candor working in partnership with
Accountax to ensure compliancy
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Requirements
Which payments do I need to report?
You must report all payments if a worker has not been employed either directly by the recruitment agency on a PAYE
basis or by an umbrella company. Therefore, you are responsible for reporting payments to:
• Self-employed workers
• Limited Companies/ PSCs
• Partnerships/LLPs
Do I need to report payment to an umbrella company?
No, but you must report all of the details outlined below to the HMRC.
Reporting Requirements
Self Employed/ Limited/
PSCs/ Partnerships/ LLPs
Umbrella
Agency name and address
Agency PAYE number and PAYE reference
Yes
Yes
Yes
Yes
Reporting period to and from
Is this a nil return?
Have you ceased operating
Yes
Yes
Yes
Yes
Yes
Yes
Worker full name
Worker NI number
Yes
Yes
Yes
Yes
Where no NI number is available
Date of birth and gender
Yes
Yes
Yes
Yes
Worker address and postcode
Worker engagement details
Start and end date
Name of party paid by agency for worker’s services
Amount paid for the worker’s services
Company House registration number of party paid
by agency
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
No
No
Record Keeping
Recruitment agencies must keep the information, records and documents that prove the information
they have submitted to the HMRC is correct. They are advised to work with temporary contractors to
provide suitable evidence of why the person was not paid through a PAYE model.
All records must be kept for at least three years after the end of the tax year that they relate to.
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Deadlines
The HMRC has deadlines in place for the reports to be submitted, but you have an additional three
months to replace the report.
Reporting period
Deadline Date Latest date the report can be replaced
6th April 2015- 5th July2015
5th August 2015
5th November 2015
6th July 2015 - 5th October 2015
5th November 2015
5th February 2016
6th October 2015- 5th January 2016
5th February 2016
5th May 2016
6th January 2016- 5th April 2016
5th May 2016
5th August 2016
Penalties
Failure to provide the report or if the report is inaccurate or incomplete, a penalty fee will occur based
on the total number of penalties already raised in the previous 12 months.
1st offence
250
2nd offence
500
3rd and later offences
00
1,0
If there are 12 months between offences, you will be charged £250 for the first offence as it will fall into
the new 12 month period.
For any agency that continues to not send reports or send late reports, then they may be subject to a
penalty every day the report isn’t sent over.
HMRC can pass any unpaid tax/ NIC liability onto the Directors of the recruitment business, making
them personally liable.
There is no legal defence other than where fraud is involved.
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How can Candor help you?
The new requirements mean there is a lot more information to collect and for many agencies it will
impose significant additional administration costs.
Recruitment agencies in the first instance should take stock of their current systems and procedures
now to ensure that they will be able to collect the required information ready for the first report.
Candor is offering companies a free compliance review where our expert team will check that you
are fully compliant and help you prepare for the upcoming changes.
On an ongoing basis we are here to help and support you. We understand that each recruitment
agency is difference, we also acknowledge that you will have many questions such as...
•
•
How do I report if a worker is working on more than one contract?
How do I report if I pay in Euros?
Please get in touch with our dedicated Account Management
Team and we will provide you with the specialist advice you need.
To book your free compliance review, call Candor on
0845 388 3001 or email [email protected].
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