House of Lords Sub Committee publish follow up to off payroll working enquiry

• The House of Lords Sub-Committee has written to Lucy Frazer QC MP, Financial Secretary to the Treasury, setting out their conclusions and recommendations following their enquiry on off payroll working
• Their main findings and recommendations include;
  • HMRC must acknowledge CEST’s limits and recognise that use of other means to assess employment status is reasonable
  • More must be done to improve advice and support for those who receive a CEST “unable to determine” outcome
  • HMRC should work with stakeholders via the IR35 Forum to agree modifications to CEST to reflect the test of mutuality of obligation
  • HMRC need to address the issue of “blanket assessments” through its compliance activity
  • Introduction of a greater focus on the protection of workers who use the services of umbrella companies and a clearer indication of Government’s intentions, including a date to commit to bring forward legislation to create the proposed single enforcement body to regulate umbrella companies
  • Government focussed too narrowly on tax issues and not enough on wider issues of fairness (including individuals being treated as employees for tax purposes but not receiving employee rights)

See the full publication here

Aspire comment

The topics specifically mentioned by the House of Lords Sub-Committee are those we have seen mentioned time and time again by Government bodies, including HMRC, and contained in many consultations and other publications;

1. CEST and its limitations
2. A Single Labour Market Enforcement Body including a remit to govern umbrella companies
3. Aligning employment tax and employment status

We will wait and see whether this letter speeds up Government in dealing with these aspects.