Part 2Employment income: charge to tax
F1Chapter 9Managed service companies
The deemed employment payment
61GApplication of Income Tax Acts in relation to deemed employment
(1)
The Income Tax Acts (in particular, the PAYE provisions) apply in relation to the deemed employment payment as follows.
(2)
They apply as if—
(a)
the worker were employed by the MSC to provide the relevant services, and
(b)
the deemed employment payment were a payment by the MSC of earnings from that employment;
but this is subject to subsection (3).
(3)
No deduction under Part 5 (deductions allowed from employment income) or section 232 (mileage allowance relief) may be made from the deemed employment payment.
F2(4)
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F2(5)
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(6)
Where the MSC is a partnership and the worker is a member of the partnership, the deemed employment payment is treated as received by the worker in the worker's personal capacity and not as income of the partnership.
(7)
Where—
(a)
the worker is resident in the United Kingdom, and
(b)
the relevant services are provided in the United Kingdom,
the MSC is treated as having a place of business in the United Kingdom, whether or not it in fact does so.