About the CFDG
Consultation: VAT: Hire of Temporary Staff
HMRC has announced a review of the VAT arrangements for supplies of temporary staff, inviting affected businesses and other interested parties to contribute their views.
Currently, many employment bureaux act either as agents for VAT purposes or are able, as principals, to use HMRC's staff hire concession. Where they act as agents, bureaux are only required to charge VAT on their commission and those who act as principals (but can use the concession) only pay VAT on an amount excluding salary and other associated costs (broadly equivalent to an agent's commission).
It is possible that, in future, employment bureaux may have to charge more VAT on their supplies, making temporary staff more expensive for any user that cannot reclaim all the VAT (e.g. finance sector businesses, many schools, universities, colleges, etc.).
CFDG's Response:
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More Information:
www.gnn.gov.uk/