Taxman urges region’s firms to check for gangmasters in the run up to Olympics

Employers across the region planning to take on more staff during the Olympics and Paralympic Games were yesterday told they must carry out proper checks on agencies or 'gangmasters' providing staff.

With the Olympics leading to an increase in businesses needing temporary workers, HM Revenue and Customs (HMRC) is urging them to carry out checks on their labour suppliers. The department wants them to ensure, where possible, that the gangmasters are paying VAT and other taxes.

Businesses affected include those in catering, food processing, construction, hotels, leisure and security.

HMRC has warned there is a risk that employers could unknowingly hire workers who are in the UK illegally or are earning below the National Minimum Wage. This could result in enquires by HMRC and costs for the business, damaged reputation and even prosecution.

Marie-Claire Uhart, Director of Specialist Investigations, said: 'HMRC has found problems with fraud and unpaid taxes in the labour provider field and this might increase as companies employ more casual labour for the Games. HMRC routinely tackles attempts to defraud the Exchequer, including the use of false invoices and hijacked VAT registrations.

'East of England businesses that use labour providers can help prevent these forms of tax abuse – and avoid involvement in fraudulent supply chains – by being alert and asking the right questions.'