Labor Supply Chain: Legislation and guidance

Purpose
The provided document outlines various legislation, guidance, and resources related to employment status, tax, National Insurance contributions, and VAT rules in the UK. The purpose is to inform individuals and businesses about the necessary steps to comply with the reformed Off-Payroll working rules (IR35) and other relevant regulations.

Effects on Industry
The document’s information will have a significant impact on industries such as construction, employment agencies, and umbrella companies. It will help prevent labor fraud, payroll company fraud, and tax evasion by introducing checks for signs of these activities. Additionally, it will educate businesses about their responsibilities when working with umbrella companies and provide resources to ensure compliance with tax and VAT rules.

Relevant Stakeholders
The stakeholders affected by this information include:

• Employment intermediaries: The document provides guidance on employment status and employment rights, as well as responsibilities for employment businesses working with umbrella companies.
• Umbrella companies: The provided resources will help these companies understand their obligations and ensure compliance with tax and VAT rules.
• Employment agencies: They are warned about the risks of using umbrella companies and advised to check employment status for tax purposes.
• Individuals: The document provides tools, such as the HMRC app, to check income tax and National Insurance contributions records.

Next Steps
To comply with the reformed Off-Payroll working rules (IR35) and other relevant regulations, businesses should:

• Check their employment intermediaries for compliance with the correct employment status and rights.
• Verify the legitimacy of umbrella companies they work with to avoid labor fraud, payroll company fraud, or tax evasion.
• Utilize resources such as the HMRC app to ensure accurate income tax and National Insurance contributions records.

Any Other Relevant Information
In addition to the information provided in the document, businesses should also be aware of the following:

• The Construction Industry Scheme (CIS) requires checking for signs of labor fraud.
• VAT self-billing notice 70062 provides guidance on self-billing procedures.
• The Corporate offences for failing to prevent criminal facilitation of tax evasion introduced by ECCTA must be understood and complied with.