By Daniel Hunter

HMRC have announced revised proposals on the tax rules affecting offshore employment intermediaries following a consultation in August this year. As part of the process, PCG put forward suggestions designed to ensure that any new legislation in this area does not introduce additional red tape for freelancers and their clients.

The revised proposals from HMRC spelled out that the responsibility for correct PAYE National Insurance and tax payments will now fall to the recruiter, employment agency or vendor instead of the end user.

Commenting on the issue, PCG Chairman Simon McVicker said: “We support the overall aim of the Government to clamp down on the avoidance of taxes via offshore employment intermediaries. The fact that HMRC has introduced measures to do this without saddling independent professionals with any more complicated tax legislation is encouraging.

“However, it would have been better to see new rules on offshore employment intermediaries which address the potential for tax avoidance activity by companies engaging intra-company transfer workers. We lobbied hard on this and it is disappointing to see that no action has been taken in this area”

“Of course it’s important to remember this is a small change and the hundreds of thousands of independent professionals who do business directly with a client will still face a needlessly complicated taxation system in desperate need of change.”

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