When the Spring Budget was announced earlier this month, it included vital information for the Champion Contractors team.
Having followed the Tackling non-compliance in the Umbrella Company Market consultation paper closely during 2022 and 2023, we have been waiting intently for any sign of an update on the government's plans in response to the paper.
Cue the Spring Budget report in which Section 5 confirmed the following:
Section 5 - Policy Decisions
A fair and sustainable tax system
5.42 Tackling non-compliance in the Umbrella Company Market – The government is committed to protecting workers employed by umbrella companies, ensuring fair, genuine competition in the market and preventing significant Exchequer losses caused by tax non-compliance. The government will provide an update on the recent consultation on tackling non-compliance in the umbrella company market at Tax Administration and Maintenance Day. In summer 2024 the government will also publish new guidance to support workers and other businesses who use umbrella companies.
What Does Section 5.42 of the Spring Budget Mean for Agencies?
According to the government, the Tackling non-compliance in the Umbrella Company Market paper had three main objectives:
- To deliver improved outcomes for workers (contractors).
- To support a level playing field in the umbrella company market.
- To protect taxpayers from the significant revenue losses that currently arise from non-compliance.
With agencies playing a prominent part within the temporary labour supply chain along with umbrella companies, they are likely to be given some responsibility for deterring non-compliance. But how much responsibility is the key question?
We won't have too long to wait, hopefully, as Tax Administration and Maintenance Day is scheduled for April 18th, 2024.
Champion's SafeRec Umbrella Certification Gives Agencies Clarity and Security
The risk to recruitment agencies posed by non-compliance in the umbrella sector has increased significantly over recent years, and the update scheduled for April 18th could compound it.
However, Champion is already well positioned and prepared for any plans or actions the consultation paper update may bring. Our SafeRec umbrella certification addresses due diligence, compliance and transparency with its real-time payroll and payslip auditing and reporting functionality.
Coupled with our FCSA accreditation, SafeRec umbrella certification provides the protection and security agencies and their end clients need from an umbrella provider.
For further information, contact the Champion Contractors team on 0161 703 2549 or email info@championcontractors.co.uk.