Agency workers and VAT
The Court of Appeal judgment in Adecco UK Ltd v HMRC found that Adecco was liable to VAT on the full amounts it received from clients with which it had placed its temporary staff (‘temps’). Once again, this decision confirms that ‘contract has primacy’. However, was Lord Justice Newey correct in his assertion that Reed Employment Ltd v HMRC was incorrectly decided or has the landscape in relation to employment law changed? Indirect tax advisers are not always accustomed to determining the VAT liability of a supply by reference to non-VAT legislation. However, where those non-VAT provisions impact contractual and legal relationships, they may merit consideration.