Declaration for chain of on-hire for employment agency purposes
Declaration for liable agencies in a chain of on-hire.
Key information
Multiple employment agency contracts can arise where one employment agent (Agent 1) on-hires labour to another employment agent (you), and you on-hire that labour to your client. This is referred to as a chain of on-hire.
A strict interpretation of the employment agency provisions would mean that both you and Agent 1 would be liable for payroll tax on what is essentially the same employment agency arrangement.
To overcome this, the employment agent (you) closest to the ultimate client, that is the end-user of the labour provided by the service provider, will be regarded as the agent liable for payroll tax. Agent 1 will not be regarded as liable where you pay the payroll tax on the 'wages' paid to Agent 1. You must make a declaration and provide it to Agent 1 to confirm that you are liable and will pay the liability.
Please refer to our chain of on-hire ruling for employment agency contracts to verify your on-hire arrangements before completing this declaration.
Step 1: Gather relevant information
Before you start, make sure you have the information needed to complete the declaration. Refer to the form for details.
Step 2: Complete the declaration
This declaration is completed online. When you have completed all relevant and mandatory information, select submit and download a copy of the declaration.
Step 3: Provide declaration to agent(s)
Send the signed declaration to the employment agent that on-hired the service provider to you (Agent 1).
Next steps
The non-liable employment agent must obtain the declaration before excluding exempt wages from the wages you report to use for payroll tax. They must keep the declaration for 5 years and provide it to us if we request it.