Employment Status Training

1. Employment Status Training Bob Lane Senior Accountant - Taxation

2. Introduction • Why carry out an employment status test? • to get tax/NICs liability correct • to avoid any penalties HMRC may levy • When? • Prior to engaging an individual

3. Agency/Company • If the individual is supplied by an agency or company then responsibility for deducting tax/NICs rests with them, but you must check they are a company on Companies House website www.companieshouse.gov.uk

4. Factors affecting Employment Status • Control • Substitution • Equipment and materials • Basis of Payment • Part of organisation • Right to terminate • Financial risk • Mutual obligation

5. EmploymentStatus Fact Finder

6. Using the HMRC employment status tool • Enter yourself as Engager representative • Engager business – public sector other • Trade of worker – enter description • Providing the questions have been answered truthfully HMRC will accept the ruling given by the ESI Tool.

7. Specific categories of Staff • a) Teaching staff – if teaching mainstream curriculum almost certainly employed • Peripatetic music teachers • A one off engagement may be self employment but use ESI Tool • b) Invigilators

8. Specific categories of Staff • c) Office holders • Clerk to the Governors • External advisors in respect of Head teachers • Legislation requires that PAYE must be operated on payments to office holders. • d) Small building works – handymen • e) Sports coaches

9. VAT – Internet Purchasing • Legislation gives VAT registered businesses an entitlement to receive a VAT invoice • This does not apply to non VAT registered businesses/private individuals • Must set the school up as a business customer

10. VAT – Internet Purchasing • Know who the school is contracting with - may not be the Internet company • If supply is from an EU country the Reverse Charge procedure may apply • Use VAT Indicator W and send copy invoice to Tax team