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HMRC are upping their game with non-compliant providers

Kerry Hull

Kerry Hull | Marketing Manager

Wednesday 24th Jan, 2018

As detailed in Julian Ball's article 'Have recent Government changes helped or hindered contractors?' we have seen a number of legislative changes that have directly impacted the way that contractors, recruitment agencies and payroll providers now have to operate, with more emphasis than ever on compliance, tax avoidance schemes and, of course protecting workers rights.

The GIG economy has been under more scrutiny than ever before, and the findings from the Taylor Report have been published highlighting the areas that Government feel need addressing. There has also been greater public and political awareness and noise around tax avoidance schemes with numerous stories in the press with both individuals and companies being named and shamed.

Such activity has led to the introduction of the Criminal Finance Act, which service providers have welcomed with open arms as it gives HMRC more power to tackle non-compliance within the market place. It is encouraging to see this kind of change and increased activity from HMRC tackling, enforcing and prosecuting those that do not adhere to the rules.

An area HMRC have concentrated their efforts on over the last few months is worker's pay rights and they haven't been afraid to publish the names of those breaking the rules. In April we'll be seeing increases to the National Minimum Wage to £7.83 for over 25's and £7.38 to those aged between 21 to 24, along with increases in contribution rates to the work place pension scheme. All of these changes will put more pressure on businesses not just with profit margins being squeezed, but also in ensuring that all the rules are applied correctly.

HMRC are investing more time, money and resources into these matters so we expect to continue to see an increase in activity over the coming months cleaning up bad practice and protecting worker's rights. This activity puts more emphasis on ensuring the recruitment industry protects all aspects of worker's pay and rights, which is why more than ever it's important to work with a PSL of trusted payroll providers that not only understand tax and employment law but also adhere to them.

To find out more about how legislation affects our sector and how PayStream can support you and your workers, please contact your local Client Relationship Manager or me and we'll be happy to arrange for a meeting or training session.