VAT Payable On Full Cost Of Temps

17 February 2016

Farms and rural businesses who hire temporary staff through an agency must continue to pay VAT on the wages of those workers, and not just on any commission that is due.

A tribunal has ruled that VAT at the standard rate is due on all amounts charged to a client for the supply of temporary workers’ services, which could include salary, national insurance and pension contributions.

It follows an unsuccessful challenge by global HR staff provider Adecco, who tried to argue that VAT should only be charged on the part of the payment that related to its commission for introducing the worker to the business using them.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Image courtesy of Rasmus Thomsen at

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