In Elphysic Ltd and others v HMRC [2025] UKUT 236 (TCC) (17 July) the Upper Tribunal (UT) found in favour of HMRC on all points meaning that the companies in question were deregistered for VAT under the Ablessio principle as well as denied employment allowances to reduce the amounts of employers’ NICs due and denied use of the VAT flat rate scheme for small business.
The case concerned mini-umbrella companies (MUCs) otherwise known as specialist contracting intermediaries (SCIs). Under the MUC business model (‘the scheme’) a MUC employs workers and operates the payroll claiming employment allowance. The chain of supply is such that a MUC makes a supply of staff to employment intermediary companies which make an onward supply of staff to recruitment agencies which make an onward supply of staff to end-users....
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In Elphysic Ltd and others v HMRC [2025] UKUT 236 (TCC) (17 July) the Upper Tribunal (UT) found in favour of HMRC on all points meaning that the companies in question were deregistered for VAT under the Ablessio principle as well as denied employment allowances to reduce the amounts of employers’ NICs due and denied use of the VAT flat rate scheme for small business.
The case concerned mini-umbrella companies (MUCs) otherwise known as specialist contracting intermediaries (SCIs). Under the MUC business model (‘the scheme’) a MUC employs workers and operates the payroll claiming employment allowance. The chain of supply is such that a MUC makes a supply of staff to employment intermediary companies which make an onward supply of staff to recruitment agencies which make an onward supply of staff to end-users....
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