Jurisdiction(s):
United Kingdom

UKUT upholds FTT: umbrella company workers’ travel expenses taxable; no overarching employment; each assignment separate; 'regular attendance' clarified; benchmark scale rates need dispensation; extended assessments for carelessness (Mainpay v HMRC)

Published on: 23 August 2024

Published by a LexisNexis Tax expert

Legal News

Article summary

Mainpay Ltd v HMRC [2024] UKUT 233 (TCC)

Mainpay, an umbrella company, supplied the usual administrative and PAYE services to temporary workers whom it engaged and placed through employment agencies with end clients in hospitals and schools. It contended that, because those workers were engaged under a continuing, overarching contract (that is, a single employment), every site where they undertook assignments was a temporary workplace, so travel and subsistence were deductible from their earnings for tax. It also argued that, as each assignment was brief, the individuals could not be said to attend any workplace ‘regularly’, and therefore none could be permanent. HMRC’s position was that each assignment constituted a separate employment involving attendance at a permanent workplace, so reimbursed travel was taxable, leading to PAYE determinations and NICs decision notices (see News Analysis: FTT decides travel expenses paid to workers by an umbrella company were taxable (Mainpay Ltd v HMRC)). HMRC prevailed in the FTT. Mainpay appealed to the UT, which dismissed all grounds of appeal, concluding that there were no errors of law...

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