Due diligence on payment intermediaries

Due diligence on payment intermediaries

What you need to know

Recruitment businesses have had to deal with lots of tax changes in recent years. At the same time the range of payment models being used has grown.   REC Legal remind members that they must do full and proper due diligence on all payment intermediaries they plan to engage with.  Members should know how the temporary workers/ contractors they supply are engaged and that any payment models used are fully tax and NICs compliant.  We have previously alerted members to schemes which HMRC have said are not tax compliant – these include payment via loanpension annuities and jobs boards.  Members who engage with payment intermediaries who use these schemes risk at least reputational damage and at worst being liable for unpaid tax and NICs if they can be shown to be involved in the arrangements.  Contractors/ temporary workers also risk significant tax and NICs bills for unpaid sums.  For further information please see the REC legal guide or speak with REC Business Partners who are full FCSA members and who do not use such schemes.  

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Please call the Legal Helpline on +44 (0) 20 7009 2199 available from Monday-Thursday 8.30am-5.30pm, Friday 9.30am–5pm or email us at legal@rec.uk.com. Please quote your corporate membership number when calling or emailing us.

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