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UK – APSCo clarifies intermediaries reporting requirements for umbrella company workers

24 April 2015

The Association of Professional Staffing Companies (APSCo) has clarified the position of umbrella company workers and the new intermediary reporting requirements to Her Majesty’s Revenue and Customs (HMRC) and has updated its guidance after ongoing consultation with HMRC.

Samantha Hurley, Head of External Relations at APSCo, commented: “We have noticed a number of articles in the press suggesting that intermediaries are required to report payment information on umbrella workers – this is incorrect.”

The HMRC reporting system requires intermediaries to give the reason why Pay-As-You-Earn (PAYE) has not been applied – there are a number of options and the intermediary needs to pick the first one that applies from the list which comprises:

  • A - Self Employed
  • B - Partnership
  • C - Limited liability partnership
  • D - Limited company
  • E - Non UK engagement
  • F - Another party operated PAYE on the worker’s payments

“We very quickly realised that the final two categories on the list would never be ticked as the worker would, certainly in the professional sector, always come under one of the first four categories,” Ms Hurley added.

“We discussed this with HMRC at length and they confirmed to us that umbrella workers would come under the category of limited company. However, this has been interpreted incorrectly by some to mean that payment details must now also be reported for umbrella workers.” 

“APSCo can categorically confirm that this is not the case and we have had confirmation from HMRC that there is no legal obligation to report the payment – just the worker identity details, the company name, address and registration number, and the start/end dates of the assignment. There has been a lot of confusion and incorrect information circulating regarding this issue and we hope that this clarifies the situation,” she concluded.