Post April Off-Payroll Legislation for Recruiters: A Brief Guide

FCSA Partner JustAccountsAs we are sure many of you are aware, the legislation for off-payroll workers in the public sector has been released. Most compliant providers have prepared for this in advance, and ensured that temporary workers are engaged through the most appropriate model.

In order to help recruiters understand the changes, FCSA Business Partners, JustAccounts highlight some of the most significant changes below:

 

PSC

There are lots of changes affecting PSC’s but the most significant for recruiters are the contracts they have with public sector bodies, and understanding what is regarded as a public sector body. Recruiters may need to amend their contracts with the public sector bodies, and where this happens, rates for assignments may have changed;  therefore these negotiations and amendments need to happen soon after April for those on existing contracts.

 

Umbrella

Umbrella companies are specifically mentioned in the guidance:

  1. Where an umbrella company employs the worker directly and not through an intermediary, the new off-payroll rules do not apply. Some umbrella companies do not employ the worker directly and so this should be checked. If this is not the case then the normal rules apply.

 

Compliant MSC

The guidance states the following:

  1. The new legislation contains a disregard where Chapter 9 ITEPA 2003 applies. If a company is a compliant managed service company, it will be outside the off-payroll rules.

This appears, on the surface, to be as simple as the umbrella arrangement, but without the burden of the apprenticeship levy.

 

Agency Employed

This has always been available, and remains an option for those wishing to take the administrative burden of employing workers directly. The guidance confirms the following:

  1. Where an agency contracts directly with the worker as an employee and operates PAYE and NICs, or engages them on a self-employed basis but operate PAYE and NICs under agency rules, then the off-payroll rules do not apply.

 

JustAccounts is a software provider and hence this guidance is not an expert opinion on correctness of models, rather a commentary on how the process of getting workers paid will be affected.

Recruiters need to decide how they are going to deal with payments – in house or outsourced-,  and decide for themselves which providers they are going to use to give them a compliant service.

Where the recruiters are looking to operate across a variety of models, they need to decide who they are prepared to work with, and ensure their current contractor relationships align to this. Now is the time for strong PSLs and due diligence in the selection process.

JustAccounts provide a cloud based, white labelled, accountancy platform. The platform caters for a number of solutions including PSC’s, Umbrella, CIS and CPSC.

We have crafted a system that enables client growth, fosters efficiency, saves time and money, and makes life easier for all involved. JustAccounts helps its clients take advantage of the rapidly growing contracting market.