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HMRC internal manual

Employment Status Manual

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HM Revenue & Customs
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Basic principles: domestic workers

S.136 FA 2003

Regulation 5 of the Security Contributions (Intermediaries) (Amendment ) Regulations 2003 (SI 2003 No.2079)

Under paragraph 1(1)(a) of Schedule 12 FA 2000 (and the equivalent NICs legislation), the Schedule only applied where an individual personally performed, or was under an obligation to perform services for the purposes of a business carried on by another person (“the client”). This meant that individuals such as nannies, butlers and other domestic workers who provided their services through an intermediary such as a service company did not fall within the legislation.

The 2003 legislation substituted the words “for the purposes of a business carried on by another person” with “for another person”. It therefore removed the limitation in the legislation that restricted its application to those providing personal services to a business being carried on by a client. The measure therefore brings within the scope of the intermediaries legislation those domestic workers who provide their services through an intermediary, such as a company.

It will apply for income tax purposes to income received by the intermediary in 2003/04 relating to services provided after 9 April 2003.

For NICs purposes, the legislation applies to income received by the intermediary in 2003/04 relating to services provided after 31 August 2003.

Because of the different dates for tax and NICs, it may be necessary to prepare separate deemed payment calculations.