Part 2

Employment income: charge to tax
CHAPTER 10

Workers' services provided through intermediaries to public authorities or medium or large clients

Anti-avoidance
61WA
1
This section applies if in any case at least one relevant person in a chain participates in a relevant avoidance arrangement.
2
An arrangement is a “relevant avoidance arrangement” if its main purpose, or one of its main purposes, is to secure a tax advantage by securing that at least one of the conditions mentioned in section 61O or 61P is not met in relation to an intermediary.
3
Section 61N(3) has effect as if the reference to the fee-payer were a reference to the participating person, but—
a
section 61N(4) continues to have effect as if the reference to the fee-payer were a reference to the deemed employer, and
b
Step 1 of section 61Q(1) continues to have effect as referring to the chain payment made by the deemed employer.
4
The participating person is—
a
in a case where only one relevant person participates in the arrangement, that person;
b
in any other case the highest relevant person in the chain who participated in the arrangement and from whom HMRC considers there is a realistic prospect of recovering, within a reasonable period, the amount of tax that would have been paid (or not repaid) in the absence of the arrangement.
5
Subsection (3) has effect even though that may involve a participating person being treated as both employer and employee in relation to the deemed employment under section 61N(3).
6
In this section—
- “
arrangement
” includes any agreement, understanding, scheme, transaction or series of transactions (whether or not legally enforceable);
- “
deemed employer
” means a person who would, but for this section, be treated by section 61N(3) as making a payment to the worker;
- “
relevant person
” means—
  1. the worker;
  2. a person who is resident in the United Kingdom or who has a place of business in the United Kingdom;
- “
tax
” means income tax (and “
tax advantage
” is to be construed accordingly”);
- “
tax advantage
” includes—
  1. avoidance or reduction of a charge to tax or an assessment to tax,
  2. repayment or increased repayment of tax,
  3. avoidance of a possible assessment to tax, and
  4. deferral of a payment of tax or advancement of a repayment of tax.
S. 61WA inserted (with effect in accordance with s. 21(10) of the amending Act) by Finance Act 2021 (c. 26), s. 21(8)
Pt. 2 applied (E.W.S.) (31.3.2017) by The Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017 (S.I. 2017/353), reg. 1(1), Sch. 1 para. 4(3) (with reg. 2(4)(5))
Pt. 2 Ch. 10 inserted (with effect in accordance with Sch. 1 para. 16 of the amending Act) by Finance Act 2017 (c. 10), Sch. 1 para. 9
Pt. 2 applied (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), ss. 969(4)(a), 1329(1) (with Sch. 2 Pts. 1, 2)
Pt. 2 Ch. 10 heading substituted (with effect in accordance with Sch. 1 para. 25 of the amending Act) by Finance Act 2020 (c. 14), Sch. 1 para. 8 (with Sch. 1 paras. 30-34)