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HMRC internal manual

Employment Status Manual

Conditions of liability: where the intermediary is an individual

Paragraph 5 Schedule 12 Finance Act 2000 / Section 53 Chapter 8 ITEPA 2003

Regulation 5(8) SI 2000 No. 727

Where the intermediary is an individual, the legislation will only apply if:

  • a payment or benefit is received or receivable by the worker directly from the intermediary, and
  • can reasonably be taken to represent remuneration for services provided by the worker to the client.

It is unlikely in practice that you will come across the situation where there will be liability under the legislation where intermediary is an individual. Usually, in such circumstances, the worker will either be:

  • an employee of the individual, or
  • the agency legislation will apply and any income will already be chargeable to tax as employment income and subject to Class 1 NICs.