Employment Intermediaries Reporting – Your Responsibilities

What is an intermediary?

An intermediary is any organisation who makes arrangements for an individual to work for a third party (generally regarded as the client) or to be paid by the intermediary for work done for a third party. A recruitment agency will most commonly be the intermediary.

If you supply workers to the intermediary that has the contract with the client, you don’t have to send a report. You’ll have to provide details of the workers you supply to the intermediary with the contract, and they will provide the information to HMRC.

What does an intermediary need to do?

An intermediary must return details of all workers they place with clients where the intermediary doesn’t operate PAYE on worker’s payments. They need to be sent to HMRC at least every three months, however you can decide on the frequency of report submissions. Where you have not supplied workers in a specific quarter, you must file a ‘nil report’ by the deadline date.

HMRC provide a report template. An agency is required to upload the reports using their online service.

Who is exempt?

You do not have to send the reports if all the following statements are true:

  • Are a UK employer
  • Supply workers to provide their services to end clients and nobody else in involved
  • Operate PAYE when you pay those workers

What do the regulations mean?

They will allow HMRC to support with intermediaries that comply, penalise those that don’t, ensure the right tax and NI is paid by people working through intermediaries and reduce unfair commercial advantage.

What about PSCs?

One-person limited companies, or personal service companies (PSC), that only supply a client with one worker don’t have to send reports to HMRC.

If the worker is supplied through an intermediary they will be included in the report the intermediary that has the contract with the end client sends to HMRC.

What do you need to do?

You must provide details about workers and their engagements for all workers where you do not operate PAYE. This includes engagements they are working on and those that ended in the reporting period you’re sending a report for.

You must keep information, records and documents that prove what you sent to HMRC was correct.


Penalties for incorrect or late reports are severe so it’s important that intermediaries understand their responsibilities.
The amount of the penalty is based on the number of offences in a 12 month period.
£250 – first offence, £500 – second offence and £1,000 – third and later offences

If you would like any further information about Intermediaries reporting and your responsibilities, please feel free to contact 1PS on 0207 175 1177 or email at hello@my1ps.com.

Georgia Burbridge

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