Tax Pactitioners Board Labour hire
Tax Practitioners Board Labour hire
On 8 January 2016, the Tax Practitioners Board issued its final information sheet on Labour hire/on-hire firms after considering industry comments and submissions.
Generally, the TPB considers that where a labour hire/on-hire firm is merely sourcing a candidate for a client and the client is fully responsible for the employment or engagement of the candidate (including remuneration), then the labour hire/on-hire firm does not need to register with the TPB.
This is because the labour hire/on-hire firm is providing a person rather than a tax agent service.
This scenario would likely include labour hire/on-hire firms that provide permanent placement services.
On the other hand, if the labour hire/on-hire firm is involved in placing a candidate with a business client to provide tax agent services, and the labour hire/on-hire firm is responsible for the remuneration of the candidate and also for ensuring that the end client is satisfied with the services provided by the candidate, then the labour hire/on-hire firm will most likely need to register with TPB.
In this case, the labour hire/on-hire firm is considered to be providing a tax agent service rather than merely providing a person.
This scenario would likely include service trust arrangements.
Whether a labour hire/on-hire firm needs to register with the Tax Practitioners Board is a question of fact.
This means that each situation will need to be considered on a case-by-case basis having regard to the facts and circumstances of the labour hire/on-hire firm.
This will usually involve an examination of markerting and/or advertising by the labour hire/on-hire firm.
Ref: TPB Information Sheet- TPB(I) 26/2016
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