Welfare Reform and Pensions Bill - continued        House of Lords
PART II, BEREAVEMENT PAYMENT - continued
Sharing of functions as regards certain claims and information - continued

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  CHAPTER II
  NATIONAL INSURANCE CONTRIBUTIONS
New threshold for primary Class 1 contributions.     68. Schedule 9 (which amends the Contributions and Benefits Act, the Administration Act and the Pension Schemes Act 1993 so as to make provision for and in connection with the introduction of a new primary threshold for primary Class 1 contributions) shall have effect.
 
New threshold for primary Class 1 contributions: Northern Ireland.     69. Schedule 10 (which amends the Social Security Contributions and Benefits (Northern Ireland) Act 1992, the Social Security Administration (Northern Ireland) Act 1992 and the Pension Schemes (Northern Ireland) Act 1993 so as to make provision for and in connection with the introduction for Northern Ireland of a new primary threshold for primary Class 1 contributions) shall have effect.
 
Earnings of workers supplied by service companies etc.     70. After section 4 of the Contributions and Benefits Act there shall be inserted-
 
 
"Earnings of workers supplied by service companies etc.     4A. - (1) Regulations may make provision for securing that where-
 
    (a) an individual ("the worker") in any specified circumstances personally performs, or is under an obligation personally to perform, services for the purposes of a business carried on by another person ("the client"), and
 
    (b) the performance of those services by the worker is (within the meaning of the regulations) referable to a contract between the client and a third party,

relevant payments or benefits are, to the specified extent, to be treated for the purposes of the applicable provisions of this Act as earnings paid to the worker in respect of an employed earner's employment of his (where they would not be such earnings apart from the regulations).
      (2) Subsection (1) above applies-
 
 
    (a) whether or not the client is a person with whom the worker holds any office or employment; and
 
    (b) whether or not there is any contract between the third party and the worker.
      (3) Regulations under this section may, in particular, make provision-
 
 
    (a) for the worker to be treated for the purposes of the applicable provisions of this Act, in relation to relevant payments or benefits, as employed in employed earner's employment by the client;
 
    (b) for the client to be treated for those purposes as the secondary contributor in respect of any earnings which are treated as paid to the worker in connection with relevant payments or benefits;
 
    (c) for determining-
 
      (i) any deductions to be made, and
 
      (ii) in other respects the manner and basis in and on which the amount of earnings that the worker is to be treated as having been paid for any period is to be calculated or estimated,

in connection with relevant payments or benefits;
 
    (d) for apportioning payments or benefits of any specified description, in such manner or on such basis as may be specified, for the purpose of determining the part of any such payment or benefit which is to be treated as a relevant payment or benefit for the purposes of the regulations;
 
    (e) for disregarding for the purposes of the applicable provisions of this Act, in relation to relevant payments or benefits, an employed earner's employment in which the worker is employed (whether by the third party or otherwise) to perform the services in question;
 
    (f) for otherwise securing that a double liability to pay any amount by way of a contribution of any description does not arise in relation to a particular payment or benefit or (as the case may be) a particular part of a payment or benefit;
 
    (g) for securing that, to the specified extent, two or more connected persons (within the meaning of section 839 of the Income and Corporation Taxes Act 1988) are treated as a single person for any purposes of the regulations;
 
    (h) (without prejudice to paragraph (g) above) for securing that a contract made with a person other than the client is to be treated for any such purposes as made with the client;
 
    (i) for excluding or modifying the application of the regulations in relation to such cases, or payments or benefits of such description, as may be specified.
      (4) Regulations under this section may make provision for securing that, in applying any provisions of the regulations, any term of a contract or other arrangement which appears to be of a description specified in the regulations is to be disregarded.
 
      (5) Any regulations made in pursuance of subsection (3)(i) above may be framed by reference to-
 
 
    (a) any certification procedure which may be established by the Treasury for the purposes of that provision, or
 
    (b) such certification procedure established by the Inland Revenue as may be specified;

and any regulations made in pursuance of section 2(2) above or section 7(2) below may also be framed by reference to any certification procedure such as is mentioned in paragraph (a) or (b) above.
      (6) In this section-
 
 
    "the applicable provisions of this Act" means this Part of this Act and Parts II to V below;
 
    "business" includes any activity carried on-
 
      (a) by a government department or public or local authority (in the United Kingdom or elsewhere), or
 
      (b) by a body corporate, unincorporated body or partnership;
 
    "relevant payments or benefits" means payments or benefits of any specified description made or provided (whether to the third party or the worker or otherwise) in connection with the performance by the worker of the services in question;
 
    "specified" means prescribed by or determined in accordance with regulations under this section;
 
    "third party" includes-
 
      (a) any person with whom the worker holds any office or employment, and
 
      (b) any body corporate, unincorporated body or partnership of which the worker is a member.
      (7) Any reference in this section to the performance by the worker of any services includes a reference to any such obligation of his to perform them as is mentioned in subsection (1)(a) above.
 
      (8) Regulations under this section shall be made by the Treasury with the concurrence of the Secretary of State.
 
      (9) If, on any modification of the statutory provisions relating to income tax, it appears to the Treasury to be expedient to modify any of the preceding provisions of this section for the purpose of assimilating the law relating to income tax and the law relating to contributions under this Part of this Act, the Treasury may with the concurrence of the Secretary of State by order make such modifications of the preceding provisions of this section as the Treasury think appropriate for that purpose."
 
Earnings of workers supplied by service companies etc: Northern Ireland     71. After section 4 of the Social Security Contributions and Benefits (Northern Ireland) Act 1992 there shall be inserted-
 
 
"Earnings of workers supplied by service companies etc.     4A. - (1) Regulations may make provision for securing that where-
 
    (a) an individual ("the worker") in any specified circumstances personally performs, or is under an obligation personally to perform, services for the purposes of a business carried on by another person ("the client"), and
 
    (b) the performance of those services by the worker is (within the meaning of the regulations) referable to a contract between the client and a third party,

relevant payments or benefits are, to the specified extent, to be treated for the purposes of the applicable provisions of this Act as earnings paid to the worker in respect of an employed earner's employment of his (where they would not be such earnings apart from the regulations).
      (2) Subsection (1) above applies-
 
 
    (a) whether or not the client is a person with whom the worker holds any office or employment; and
 
    (b) whether or not there is any contract between the third party and the worker.
      (3) Regulations under this section may, in particular, make provision-
 
 
    (a) for the worker to be treated for the purposes of the applicable provisions of this Act, in relation to relevant payments or benefits, as employed in employed earner's employment by the client;
 
    (b) for the client to be treated for those purposes as the secondary contributor in respect of any earnings which are treated as paid to the worker in connection with relevant payments or benefits;
 
    (c) for determining-
 
      (i) any deductions to be made, and
 
      (ii) in other respects the manner and basis in and on which the amount of earnings that the worker is to be treated as having been paid for any period is to be calculated or estimated,

in connection with relevant payments or benefits;
 
    (d) for apportioning payments or benefits of any specified description, in such manner or on such basis as may be specified, for the purpose of determining the part of any such payment or benefit which is to be treated as a relevant payment or benefit for the purposes of the regulations;
 
    (e) for disregarding for the purposes of the applicable provisions of this Act, in relation to relevant payments or benefits, an employed earner's employment in which the worker is employed (whether by the third party or otherwise) to perform the services in question;
 
    (f) for otherwise securing that a double liability to pay any amount by way of a contribution of any description does not arise in relation to a particular payment or benefit or (as the case may be) a particular part of a payment or benefit;
 
    (g) for securing that, to the specified extent, two or more connected persons (within the meaning of section 839 of the Income and Corporation Taxes Act 1988) are treated as a single person for any purposes of the regulations;
 
    (h) (without prejudice to paragraph (g) above) for securing that a contract made with a person other than the client is to be treated for any such purposes as made with the client;
 
    (i) for excluding or modifying the application of the regulations in relation to such cases, or payments or benefits of such description, as may be specified.
      (4) Regulations under this section may make provision for securing that, in applying any provisions of the regulations, any term of a contract or other arrangement which appears to be of a description specified in the regulations is to be disregarded.
 
      (5) Any regulations made in pursuance of subsection (3)(i) above may be framed by reference to-
 
 
    (a) any certification procedure which may be established by the Treasury for the purposes of that provision, or
 
    (b) such certification procedure established by the Inland Revenue as may be specified;

and any regulations made in pursuance of section 2(2) above or section 7(2) below may also be framed by reference to any certification procedure such as is mentioned in paragraph (a) or (b) above.
      (6) In this section-
 
 
    "the applicable provisions of this Act" means this Part of this Act and Parts II to V below;
 
    "business" includes any activity carried on-
 
      (a) by a government department or public or local authority (in the United Kingdom or elsewhere), or
 
      (b) by a body corporate, unincorporated body or partnership;
 
    "relevant payments or benefits" means payments or benefits of any specified description made or provided (whether to the third party or the worker or otherwise) in connection with the performance by the worker of the services in question;
 
    "specified" means prescribed by or determined in accordance with regulations under this section;
 
    "third party" includes-
 
      (a) any person with whom the worker holds any office or employment, and
 
      (b) any body corporate, unincorporated body or partnership of which the worker is a member.
      (7) Any reference in this section to the performance by the worker of any services includes a reference to any such obligation of his to perform them as is mentioned in subsection (1)(a) above.
 
      (8) Regulations under this section shall be made by the Treasury with the concurrence of the Department.
 
      (9) If, on any modification of the statutory provisions relating to income tax, it appears to the Treasury to be expedient to modify any of the preceding provisions of this section for the purpose of assimilating the law relating to income tax and the law relating to contributions under this Part of this Act, the Treasury may with the concurrence of the Department by order make such modifications of the preceding provisions of this section as the Treasury think appropriate for that purpose."
 
Class 1B contributions.     72. In section 10A of the Contributions and Benefits Act (Class 1B contributions), for subsection (6) (level of Class 1B percentage) there shall be substituted-
 
 
    "(6) In subsection (3) above "the Class 1B percentage" means a percentage rate equal to that specified as the secondary percentage in section 9(2) above for the tax year in question."
 
Class 1B contributions: Northern Ireland.     73. In section 10A of the Social Security Contributions and Benefits (Northern Ireland) Act 1992 (Class 1B contributions), for subsection (6) (level of Class 1B percentage) there shall be substituted-
 
 
    "(6) In subsection (3) above "the Class 1B percentage" means a percentage rate equal to that specified as the secondary percentage in section 9(2) above for the tax year in question."
 
 
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Prepared 24 May 1999