10 September 2020
Companies are criminally liable if they fail to prevent tax evasion by a member of their staff or other ‘associated’ persons who facilitate tax evasion. The Criminal Finance Act has been implemented to ensure companies look at their supply chain to ensure that it is operating compliantly. If an agency is in breach of the new rules, the director could be liable for the criminal acts of their employees and other ‘associated’ persons who facilitate tax evasion. It is now the responsibility of each agency to ensure that all payroll payments made to your contractors are fully compliant with HMRC guidance.
As a result of this, it’s now an ideal time to review your Preferred Supplier List. The best practice solution is to use a list of compliant providers that you know have been fully audited. You can mitigate this risk by choosing to work only with umbrella companies who are FCSA Accredited Members. Only firms that have successfully passed the independent annual review against the FCSA Code of Compliance are entitled to display the orange FCSA logo.
In addition to this, SmartWork recommends carrying out a risk assessment of all umbrella providers that you currently work with – via the following steps:
- Establish if any your contractors are paid via a loan or offshore scheme (or scheme highlighted by HMRC).
- Audit a selection of payments from each provider made in the current financial year. Our suggestion is to request a sample payslip for a specific period with matching RTI, showing gross payment through to NET payment to the individual.
- Review your policy on referral fees and check to see if your consultants stick to the PSL.
- Provide training to all of your employees and consultants. If you have an incentive scheme in place, you need to ensure all payments are legitimate and recorded.
- Review your PSL – Finding out if they are members of the Freelancer & Contractor Services Association (FCSA) is a good place to start.
A growing number of our clients are embracing PSLs – and finding that doing so can bring genuine business benefits. Creating a robust, effective PSL enables recruitment business to be confident that its providers are compliant as well as protecting their business.
Why choose SmartWork?
SmartWork is a PAYE Umbrella service with over a decade of knowledge and experience within the contracting sector. From Health Care and IT Professionals to Project Management and Military Services, Our expertise span over a vast array of industries.
We pride ourselves on being a Full FCSA Member having successfully undergone a rigorous review of our business services, operations, policies, and processes – established by the FCSA in liaison with HMRC. The FCSA Code is designed to demonstrate to Government (as well as freelancers, contractors, and recruiters looking for a service provider) that a company is financially stable, provides high-quality professional services and operates to the highest standards of transparency and accountability.
In addition to our FCSA accreditation SmartWork is also a long-standing member of APSCo of over ten years. APSCo provides a recognised stamp of quality and assurance when choosing its members, and with this, you can expect only the very best quality of service, knowledge, and compliance.
We have had a lot of success in helping contractors over the years through our Umbrella service and would welcome the opportunity of joining your PSL/ASL
If your agency would like to work in partnership with SmartWork please contact Neil Kane directly on 0800 434 6446 or email firstname.lastname@example.org