Letter re off-payroll from HMRC

The request was refused by Croydon Health Services NHS Trust.

Dear Croydon Health Services NHS Trust,

The Off-payroll legislation was introduced in Chapter 10 of the Income Tax (Earnings and Pensions) Act 2003, with the new legislation going live from April 6th 2017. This new legislation overrode, in the public sector, the existing Intermediaries Legislation (Chapter 8, ITEPA).

The new legislation is here:
https://www.legislation.gov.uk/ukpga/201...

Around July 2018 HMRC sent your body a letter asking for information related to “Checking compliance with the rules from April 2017”

For easy identification, a copy of the letter is as follows:

-- Letter start --

Off Payroll Reform in the Public Sector
Section 61M Chapter 10 ITEPA 22003 and Regulation 13 Social Security (Miscellaneous Amendments No.) Regulations 2017

Following the introduction of chapter 10 ITEPA 2003 and certain amendments to chapter 8 ITEPA 2003 (“IR35”), new rules apply in relation to off-payroll working in the public sector from 6 April 207. Where individuals work and are paid through their own intermediary, public authorities as defined in the legislation) are now responsible for deciding whether the rules apply. Where a person is assessed as being with the new rules, the public authority agencies and third parties paying the fee for the services of the worker must operate tax, NICs and operate the Apprenticeship Levy.

I would like to check your compliance with the new legislation, including any systems you have introduced to help you decide whether the offpayroll rules should apply when engaging workers via their own intermediary (either directly or via an agency or other labour provider). Such an intermediary will often be a ‘personal service company’, but as the legislation also applies where a worker is engaged via a partnership or another person, I will use the terms ‘PSC or other intermediary’ and ‘PSC etc’ in this letter.

I have listed the information we need below and would be grateful for your response by 31 August 2018. If the amount of information I have requested will make this difficult, please contact me to discuss how this can be managed.

Checking compliance with the rules from April 2017

1. Please describe the steps you took prior to April 2017:
i. to review the off-payroll engagement of PSCs or other intermediaries, to decide whether the off-payroll rules would apply
ii. please include an explanation of any different or additional steps taken in relation to PSCs etc that you engaged via an agency or other labour provider.

2. If different from 1 above, please describe the systems / processes currently in place to decide whether the off-payroll rules apply to PSCs etc, whether you engage them directly or via an agency or other labour provider. Please provide a copy of any internal guidance / operating procedures for your staff, and comment on:
i. who is responsible for carrying out the checks and approving decisions
ii. whether the Check Employment Status for Tax tool (CEST) is used to inform decisions as to whether the rules apply, and
iii. how you ensure compliance where the PSC is engaged via an agency or other labour provider.

3. For the tax year 2107/2018, if you directly engaged with and paid any worker’s own PSC or other intermediary, please tell us:
i. the total number of such PSCs etc that you engaged directly
ii. the number of such PSCs etc that you decided were within the scope of the legislation
iii. if different from (ii), the number of such PSCs etc that have been subject to deduction of tax and NIC and included in an RTI submission
iv. the number of such PSCs etc that you decided were outside the scope of the legislation
v. the names, addresses and a brief description of the worker role / nature of services provided by the PSCs etc within (iv) above.

4. For the tax year 2017/18, if you were invoiced by any agency or other labour provider for services via a worker’s own PSC or other intermiary, please provide the name of each such agency or other labour provider and, or each of them, please tell us:
i. the total number of such PSCs etc supplied by that agency / labour provider
ii. the number of such PSCs etc that you decided were within the scope of the legislation
iii. whether you told the agency / labour provider that the rules applied for every PSC etc within (ii) above and if not, please explain why not)
iv. the number of such PSCs etc, that you decided were outside the scope of the legislation
v. the name, addresses and a brief description of the worker role / nature of services provided by the PSCs etc within iv) above.

5. Please identify any workers / PSCs etc that you decided were within the off-payroll rules, which have subsequently been engaged / paid via umbrella companies. Do you have any policy in place that encourages the use of umbrella companies for those found to be within the rules?

6. For those not working through umbrella companies, have any workers that previously worked through their own PSC etc subsequently entered into employment contracts with your group?

7. The offpayroll rules do not apply where a public authority has fully contracted out servicces to a third party e.g. an outsourcing company operating under a contract where the workers do not personally provide their services to the public authority. If you believe this applies to you, please provide an explanation for the affected contract(s).

More information about the check

I enclose factsheet CC/FS1c ‘General information about compliance checks into certain large and complex businesses’. Please take time to read this, it gives you more information about this type of check. I also enclose factsheet CC/FS22 ‘Sending us electronic records’.

If you have any questions, please contact me using the details shown at the top of this letter.

-- Letter end --

Please can you provide:

1. Confirmation as to whether you received the letter
2. Confirmation as to whether you responded to the letter to HMRC.
3. Confirmation as to whether you provided ANY or all of the information to HMRC.
4. A copy of your response to that letter with the following direction: Instead of the exact answers for 3(v) and 4(v) (which are likely to be confidential) please instead tell us the number of items on those lists.

If the FOI time limit of 3.5 hours is such that not all of these records can be obtained in the time limit of 3.5 hours, then please provide as much as possible until the time limit is reached. Thank you.

Yours faithfully,

Dave Chaplin

foi (CROYDON HEALTH SERVICES NHS TRUST), Croydon Health Services NHS Trust

FOI 1193: Our reference New Freedom of Information Request – Acknowledgement

Thank you for your FOI request which is now being considered. Your reference number is: FOI 1193, and should be quoted in all your future correspondence relating to this request.

It is anticipated that a response will be communicated to you within 20 working days in compliance with the Freedom of Information Act 2000.

Kind regards

FOI Team
Croydon Health Services NHS Trust
Email: [email address]

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foi (CROYDON HEALTH SERVICES NHS TRUST), Croydon Health Services NHS Trust

Dear David,

 

FOI REFERENCE NUMBER: 1193
 
Thank you for your email of 15th January 2019 requesting information Under
the Freedom of Information Act (FOIA) 2000.  I set out below your request
together with our response:

 The Off-payroll legislation was introduced in Chapter 10 of the Income
Tax (Earnings and Pensions) Act 2003, with the new legislation going live
from April 6th 2017. This new legislation overrode, in the public sector,
the existing Intermediaries Legislation (Chapter 8, ITEPA).

The new legislation is here:
[1]https://www.legislation.gov.uk/ukpga/201...

Around July 2018 HMRC sent your body a letter asking for information
related to “Checking compliance with the rules from April 2017”​

1.      Confirmation as to whether you received the letter.  Having
checked our records we can find no trace of receiving the letter to which
you refer.

2.      Confirmation as to whether you responded to the letter to HMRC.
 We did not respond as we did not receive the letter.

3.      Confirmation as to whether you provided ANY or all of the
information to HMRC.  We did not provide any information as we did not
receive the letter.

4.      A copy of your response to that letter with the following
direction: Instead of the exact answers for 3(v) and 4(v) (which are
likely to be confidential) please instead tell us the number of items on
those lists.   We have no response to provide as we did not receive the
letter.

 

We would like to also confirm that we are aware of the rules and are
compliant with them.

 

The information supplied to you continues to be protected by the
Copyright, Designs and Patents Act 1988. You are free to use it for your
own purposes, including any non-commercial research that you are doing and
for the purposes of news reporting. Any other reuse, for example
commercial publication, would require the permission of the copyright
holder which must be expressly given.

 

If you are unhappy with this response the Trust has a formal Complaints
Procedure which you may use by writing to The Medical Director,
[Croydon Health Services NHS Trust request email].  If you remain unsatisfied you may contact the
Information Commissioner’s Office at Wycliffe House, Water Lane, Wilmslow,
Cheshire   SK9 5AF.   Further details of this procedure can be found
online at - https://ico.org.uk/.

Thank you for your interest in Croydon Health Services NHS Trust.

 

Yours sincerely

 

FOI Team

Croydon Health Services NHS Trust

Email: [email address]

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