Regulation 3 Umbrella companies: joint and several liability
Paragraph (2) applies if—
an individual (“the worker”) personally provides services, or enters into arrangements with a view to personally providing services, to another person (“the client”),
the worker is employed as an employed earner by a third person (the “umbrella company”)—
that carries on a business, whether or not with a view to profit and whether or not in conjunction with any other business, of supplying labour, and
that is not a company in which the worker has a material interest, and
the umbrella company arrangements conditions are met.
Each relevant party—
is, along with the umbrella company, jointly and severally liable to pay any amount payable, in accordance with sections 6, 10 and 10A of and paragraph 3 of Schedule 1 to the SSCBAf1, by the umbrella company in relation to a qualifying umbrella company payment, but
is not to be treated as the secondary contributor for the purposes of section 7 of the SSCBAf2.
The umbrella company arrangements conditions are that—
there is a contract between the umbrella company and—
the client, or
another person,
under or in consequence of the contract—
the services are provided, or
the umbrella company is paid, or otherwise provided with consideration, for the services, and
if the contract is not between the umbrella company and the client—
there is a contract between the client and another person, and
the provision of the services or of payment or other consideration for the services is also a consequence of that other contract, whether directly or as a result of a series of contracts involving other persons.
Any issue whether the circumstances are such as are mentioned in paragraph (1) is an issue relating to contributions that is prescribed for the purposes of section 8(1)(m) of the Social Security Contributions (Transfer of Functions, etc.) Act 1999 (decision by officers of Board).
Annotations
Footnotes
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Section 6 of the Social Security Contributions and Benefits Act 1992 (“SSCBA”) was substituted by paragraph 2 of Schedule 9 to the Welfare Reform and Pensions Act 1999 (“WRPA 1999”) and was amended by section 77 of the Child Support, Pensions and Social Security Act 2000 (c. 19) (“CSPSSA 2000”). Section 10 of the SSCBA was substituted by section 74 of CSPSSA 2000 and amended by paragraph 2 of Schedule 1 to the National Insurance Contributions Act 2002 (c. 19) (“NICA 2002”), paragraph 174 of Schedule 6 and Part 1 of Schedule 8 to the Income Tax (Earnings and Pensions) Act 2003, section 14 of the National Insurance Contributions Act 2014 (c. 7), paragraph 23 of Schedule 1 to the Finance Act 2015 (c. 11), sections 1 and 3 of the National Insurance Contributions (Termination Awards and Sporting Testimonials) Act 2019 (c. 23) and S.I. 2007/799. Section 10A of the SSCBA was inserted by section 53 of the Social Security Act 1998 (c. 14) (“SSA 1998”) and amended by paragraph 11 of Schedule 3 to Social Security Contributions (Transfer of Functions, etc.) Act 1999 (“the Transfer Act”), section 77 of WRPA 1999, paragraph 3 of Schedule 1 to NICA 2002, paragraph 177 of Schedule 6 to ITEPA 2003 and paragraph 1 of Schedule 1 to the National Insurance Contributions and Statutory Payments Act 2004 (c. 3) (“NICSPA 2004”). Paragraph 3 of Schedule 1 to the SSCBA was amended by section 55 of and paragraph 77 of Schedule 7 to the SSA 1998, paragraph 33 of Schedule 3 to the Transfer Act, Part 8 of Schedule 9 to the CSPSSA 2000, paragraph 13 of Schedule 1 to the NICA 2002 and section 1 of and Schedule 2 to the NICSPA 2004.
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Section 7 of the Social Security Contributions and Benefits Act 1992 was amended by paragraph 7 of Schedule 3 to the Social Security Contributions (Transfer of Functions, etc.) Act 1999, paragraph 173 of Schedule 6 to the Income Tax (Earnings and Pensions) Act 2003, paragraph 2 of Schedule 2 to the National Insurance Contributions Act 2014 and section 6 of the National Insurance Contributions Act 2015 (c. 5).