Professional Service Firms vs Labour Services

[jpdw]

Apologies if this has been asked & discussed many times - in which case my search-fu is lacking.

I've re-read through the T&S proposal document (having only skimmed it last month) and in particular the part that lets the big consultancies off the hook -- i.e. the presence of Employment Intermediary which is an entity that "supplies labour" as opposed to Big Consultancy Ltd which "supplies professional services" rather than labour.

So where's the distinction between supplying a professional service vs labour? In the IT sector an engager wants to be supplied with someone with particular professional skill - be it a particular type of developer or an analyst or project manager. And I'm sure its similar is many other sectors. This sounds like professional service, not just 'labour'.

What am I missing?

[SueEllen]

Consultancies often supply an entire team of people to do all or a large chunk of a project. They also tend to manage it.

There as agencies mostly supply individuals. They are not involved in the management of the project.

[jpdw]

Consultancies often supply an entire team of people to do all or a large chunk of a project. They also tend to manage it. There as agencies mostly supply individuals. They are not involved in the management of the project.

They often do but I've been in projects where that's definitely not been the case -- the big Consultancy only having a proportion of the staff or a proportion of the project managers. Of course, its possible they may on these occasions in the future 'accidentally' fall into this legislation (such a shame ). And some agencies have sole-supplier agreements with the clients - does that make them Consultancies providing a Professional Service rather than just labour ? It seems HMRC add taking something that is pretty much black-or-white and making it very grey and opaque .

But it does seem that if you are convincingly operating as providing a Professional Service with no 'employment intermediaries' that substantially provide labour between you and the client ('engager') then you would be outside the scope and able to continue claiming home-to-work travel....?

[northernladuk]

They often do but I've been in projects where that's definitely not been the case -- the big Consultancy only having a proportion of the staff or a proportion of the project managers. Of course, its possible they may on these occasions in the future 'accidentally' fall into this legislation (such a shame ). And some agencies have sole-supplier agreements with the clients - does that make them Consultancies providing a Professional Service rather than just labour ? It seems HMRC add taking something that is pretty much black-or-white and making it very grey and opaque .

But it does seem that if you are convincingly operating as providing a Professional Service with no 'employment intermediaries' that substantially provide labour between you and the client ('engager') then you would be outside the scope and able to continue claiming home-to-work travel....?

But that's the model for the larger outsourcing agreements. They bid low for a piece of work and then when they get on site they make their money on anything they can be it, a raft of smaller projects, a couple of bums on seats. Hell they even end up charging clients for their own damn infrastructure. It's all covered contractually so HMRC won't interfere.