EBT and racy tax models fail us again

The hills are alive with the sound of another Employee Benefit Trust (EBT) scheme failure. Contractors unpaid, agencies paying twice and end clients wondering what the heck it has to do with them!

I have written, spoken and moaned about the risks of using these solutions but the damage has once again been done. I will say once again that Contractors can’t be surprised when the authorities end up mass legislating to prevent what is seen as cowboy behaviour.

I even saw a scheme advertised yesterday (with the usual QC opinion point to support it) suggesting a 100% return eg no tax! How can that be morally correct let alone sensible?

Agencies must look very carefully at who helps them manage contractors and Contractors need to be aware that when an Agency prefers a supplier, it should be for all parties benefit in terms of risk reduction.

1 Comment

  1. admin August 23, 2011 10:42 pm 

    Sigh. Since writing this another “provider” went bump owing Contractors thousands and thousands. Agencies ended up paying out twice AGAIN, and end-clients get rightly miffed as a result of the hassle.
    Rob

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