Abusive PAYE schemes - low income workers must be protected - LITRG Press Release

Published on 20 March 2013

The LITRG has welcomed the Government’s commitment – announced today – to consult on how best to ensure that offshore employment intermediaries pay the right amount of tax and NIC on the pay of the employees on their books. Draft legislation is expected in the 2014 Finance Bill.

LITRG Technical Director Robin Williamson commented:

“It is not unusual for employers to delegate their payroll obligations to intermediaries, some of whom may be based offshore. Some intermediaries account for tax and NICs properly, but others engage in imaginative, sometimes even abusive, schemes which result in tax and NICs being avoided.

“The Exchequer loses out from such schemes, but the real victims are the workers themselves. They often have no real choice but to accept offers of work even if the terms look unacceptable to them. If they refuse work, their may be sanctioned by the Department for Work and Pensions and their benefits withdrawn; if they accept, they may face investigation by HMRC years later, particularly if HMRC cannot get at the employment intermediaries.

“We trust that the protection of these low-income workers will be a paramount concern in the consultation.”

(20-03-13)

Contact: Robin Williamson (please use form at http://www.litrg.org.uk/ContactUs)