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Watling and Hirst Limited, Chartered Certified Accountants and Registered Auditors - Chichester, West Sussex > News > Treasury targets construction contractors

Treasury targets construction contractors

Posted on Monday, 14 September 2009 03:40PM by TR
HM Treasury have launched a consultation targeting 300,000 subcontractors supplying labour only services. It is proposed that the contractors must satisfy 3 key tests or be deemed to be employed.

The “deeming criteria” proposed are:

  • “Provision of plant and equipment – that a person provides the plant and equipment required for the job they have been engaged to carry out. This will exclude the tools of the trade which it is normal and traditional in the industry for individuals to provide for themselves to do their job;
  • Provision of all materials – that a person provides all materials required to complete a job; or
  • Provision of other workers – that a person provides other workers to carry out operations under the contract and is responsible for paying them.”
Failure to meet at least one of these criteria will mean that the contractor will be deemed to be in receipt of employment income. Therefore earnings will be subject to PAYE, and both employee and employers national insurance contributions. However the contractors will not receive the employment benefits that normally are associated with suffering these deductions.

The consultation closes on 12th October and to submit a response please follow this link:

If you would like any advice in connection with your employment status or that of your subcontractors then please do not hesitate to contact us.
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