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HMRC internal manual

Compliance Operational Guidance

Supporting Guidance: employer compliance: guidance by subject: particular occupations: agency workers - avoidance through short term engagements

See COG908600 for general information on agency workers.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Where an agency says that workers are paid monthly the caseworker should

  • check that the actual payments to the individual workers shown in the agency’s records confirm monthly payment.

If it is established that PAYE was operated on a monthly basis but the worker was actually paid weekly, the caseworker should tell the agency

  • to operate PAYE on a weekly basis using emergency code, or BR as appropriate, and
  • operate a weekly earnings period for NIC
  • that the facts will be referred to the PAYE section
  • consider whether a recovery position exists for the past for both Tax and NIC and seek recovery where appropriate
  • send written confirmation of the advice given to the agency and
  • a report of the full facts to the PAYE Section.

In all cases forms P46 should be completed by the agency worker immediately prior to their first engagement, and not when they register with the agency for work.

Where this is not being done, the caseworker should tell the agency to

  • apply the correct procedures, and
  • operate PAYE in accordance with the declaration signed on the form P46.

Where the agency maintains that for operational reasons it is not possible to obtain forms P46 immediately prior to the worker’s first engagement, the caseworker should tell the agency that the matter will be referred to the PAYE section for consideration.

  • make sure that written confirmation of advice given is sent to the agency and
  • advise the PAYE section of the full facts.