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Debt transfer FAQs
Does an umbrella provider pose any risk to the agency?
Answer

Whilst genuine umbrella providers do not pose any risk under debt transfer rules, recommending an umbrella provider that at a later date is found to be non compliant can also represents risks to agencies and their contractors.

Professional Passport has always advocated that appropriate levels of due diligence need to be carried out on any provider, umbrella or accountancy service, before an agency recommends their services to contractors. Not only does this ensure that the agencies brand remains protected but also; we believe you would be expected to be able to demonstrate appropriate levels of due diligence and duty of care, to remain safe against any class action brought by contractors in the event of a provider being found non compliant, whether that provider was an umbrella or accountancy service.

This has always been the case and is a matter of best business practice.

There are further best practice guidelines available to our members, which cover other aspects on protecting contractors and Agencies who use umbrella providers. This has recently been updated in line with the announcement made in Bulletin 28 in relation to expense dispensations.

 
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