Basic principles: conditions of liability: where the intermediary is a company and the worker does not have a material interest - example
This example reflects only one scenario in which the amount receivable could be taken to represent remuneration for services provided by the worker.
Mr D works in the construction industry through a composite service company in which he holds 4% of the ordinary share capital. The company receives £1,500 each month for his services. From this amount Mr D pays himself a dividend of £1,150. The balance of £350 is paid as follows:
£30 as an administration fee
£50 to cover company running costs
£120 to Mr D’s wife and
£150 to Mr D as a wage
Mr D performs no other services for the company other than to work for the client. The company has no other income derived from Mr D’s services. Therefore, the amount he draws from the company can be linked to those services. The amount to be brought into account at Step One of the deemed payment is the full amount of £1,500 received by the service company.