16 September 2014 
Amanda Darley, Head of Operations and Engagement
Already generating discussion on the BUFDG discussion board is the fact that the Adecco VAT appeal regarding temporary staff has been listed for hearing at the First Tier Tax Tribunal from 11-15 May 2015. The case involves temporary staff hire and whether or not VAT should be due on the full amount paid to the staff agency, as per HMRC’s position since the removal of the Staff Hire Concession in April 2009, or whether it should only be due on the agency’s fee and not on the payments made to the worker (salary and tax etc.). Temporary staff can be a big cost in universities, and the majority of VAT incurred on this cost is irrecoverable, so reducing the VAT cost would be very beneficial.
The Charity Tax Group (‘CTG’) has been supporting Adecco’s challenge to HMRC, being taken by Deloitte, and has publicised the fact that Deloitte is offering charities the opportunity to support the case on a contingency funding basis. As part of its offer, Deloitte will work with you to assess your contracts and to help you prepare duly quantified claims.
The CTG’s briefing document issued in February 2013 explains the issue and the arguments for only paying VAT on the agent’s fees, and also sets out Deloitte’s offering as well as further contact details for Deloitte if you wish to follow up on this.
It should be noted that not all arrangements with staff agencies will fit the model being argued by Deloitte in the Adecco case, so VAT savings would only be available in similar circumstances.
