Service provision changes

By Tolley in association with Dr John McMullen, Partner, Wrigleys Solicitors LLP and Visiting Professor of Law, Durham University
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The following Employment Tax guidance note by Tolley in association with Dr John McMullen, Partner, Wrigleys Solicitors LLP and Visiting Professor of Law, Durham University provides comprehensive and up to date tax information covering:

  • Service provision changes
  • Practical assessment
  • Retention of key personnel

Please note that all case references in this guidance note are subscription sensitive.

A change of service provider may amount to a 'service provision change' within the meaning of the TUPE, whether or not it is also a 'business transfer'. See the Transfer of undertakings overview guidance note.

A service provision change may involve any one of three possibilities:

outsourcingwhere activities cease to be carried out by a business on its own behalf and are carried out instead by a contractorSI 2006/246, reg 3(1)(b)(i)
change of contractorwhere activities cease to be carried out by a contractor on a client's behalf (whether or not those activities had previously been carried out by the client on his own behalf) and are carried out instead by another contractor on the client's behalfSI 2006/246, reg 3(1)(b)(ii)
insourcingwhere activities cease to be carried out by a contractor or a subsequent contractor on a client's behalf (whether or not those activities had previously been carried out by the client on his own behalf) and are once again carried out instead by the client on his own behalf

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