Agency News:

Good news for Gabem's contractors and agency clients-Gabem's high standards are commended at a time when HMRC is scrutinising dispensations closely.

Late last year, the Government made clear its intention to clamp down on companies that were not complying with regulations while providing umbrella companies or contract options to temporary and self-employed workers. To be sure that it complies with legislation, Gabem Management Limited took the unusual step of inviting HMRC to check its policies and procedures. As a result, HMRC commended Gabem's operations and granted the company expenses dispensation.

HMRC was able to examine and approve the over-arching contract that we have set up for our umbrella employees. This is an important differentiation, as such contracts are a pre-requisite for all umbrella organisations, but it appears that some contracts currently offered elsewhere in the marketplace fall foul of the law.

Having agreed our contractual approach, HMRC also granted the expenses dispensation. This benefits the thousands of individuals being paid through Gabem because it allows them to offset legitimate expenses against tax liabilities without having to report the expenses on their tax returns. In addition to reducing administration, the dispensation also reinforces confidence that Gabem is doing business in a compliant and effective manner.

Trudy Gordon had this to say: "This recognises our exceptional efforts to ensure compliance," contractor payroll "is a difficult market in which to operate because of the complex and changing legislation. We are obviously delighted with HMRC's approval of our procedures and systems, but we're not surprised. We have invested in the best advice available, both from our legal advisers Penningtons and from KPMG. Inside Gabem we work extremely hard to make sure we not only provide the best service to our customers, but are also completely compliant with current legislation."

"The abuse of expenses dispensations is all too common within our industry and is tarnishing the reputations of those organisations that go to great lengths to be compliant. That's why we invited HMRC to see our operations, as a result of which they commended us on our robust processes and the steps we take to ensure we safeguard our operatives. We have always required employees of the Gabem Umbrella company to present receipts for work-related expenses, and will continue to do so. Other, less compliant organisations may face more difficulties when their compliance is challenged."