People Group Services Limited Company Number: 11570329

Joint & Several Liability (JSL) Mitigation Policy

Purpose

The purpose of this policy is to define the controls, processes, and governance framework implemented by People Group Services Ltd (“PGS”) to mitigate the risks associated with Joint & Several Liability (JSL) under UK tax legislation.

This policy ensures that all parties within the labour supply chain are protected from exposure arising from unpaid tax liabilities, particularly those governed by Finance Act 2020 and enforced by HM Revenue & Customs.

Scope

This policy applies to:

• All payroll services delivered by PGS
• All recruitment agencies and intermediaries
• All Managed Service Providers (MSPs)
• All end clients within the supply chain
• All workers engaged via PGS

Policy Statement

PGS operates a proactive JSL mitigation framework designed to:

• Eliminate the risk of unpaid PAYE/NIC liabilities
• Provide full transparency across the supply chain
• Ensure tax compliance at source
• Protect agencies, MSPs, and end clients from secondary liability

PGS adopts a zero-tolerance approach to any arrangement that may create JSL exposure.

Regulatory Context

Joint & Several Liability provisions allow HM Revenue & Customs to pursue multiple parties in a supply chain for unpaid tax where:

• There is knowledge (actual or constructive) of non-compliance
• Due diligence has not been adequately performed
• Fraudulent or negligent arrangements are present

This includes liabilities arising under:

• PAYE and NIC regulations
• Labour supply chain fraud provisions
• Offshore intermediary rules (where applicable)

Core Mitigation Principles

PGS mitigates JSL exposure through:

Compliance at Source

All workers are paid via fully compliant PAYE payroll, ensuring tax is:

• Calculated correctly
• Deducted at source
• Reported via RTI

Financial Integrity

All statutory deductions are:

• Segregated
• Ringfenced
• Paid directly to HMRC

(Aligned with PGS HMRC Segregation Policy)

Full Supply Chain Transparency

PGS provides:

• Worker-level visibility
• Agency-level reporting
• MSP-level consolidated dashboards

Zero Non-Compliant Engagement

PGS does not engage with:

• Disguised remuneration schemes
• Offshore tax avoidance structures
• Non-compliant umbrella or intermediary models

Supply Chain Due Diligence

PGS implements robust due diligence procedures for all supply chain participants.

Agency Vetting

Prior to onboarding, agencies must:

• Undergo compliance assessment
• Provide business verification documentation
• Demonstrate adherence to PAYE obligations

Ongoing Monitoring

PGS continuously monitors:

• Payment flows
• Payroll outputs
• Behavioural risk indicators

Risk-Based Escalation

Any indicators of non-compliance trigger:

• Immediate investigation
• Suspension of services (where necessary)
• Notification to relevant stakeholders

Real-Time Liability Tracking

PGS operates a real-time liability monitoring system providing:

• PAYE/NIC obligations per worker
• Agency-level liability aggregation
• MSP-level exposure visibility

This ensures that all parties can:

• Verify compliance instantly
• Evidence due diligence
• Demonstrate risk control to HMRC

Audit Trail & Evidence

PGS maintains comprehensive audit records including:

• RTI submissions (FPS/EPS)
• Payslips and payroll calculations
• HMRC payment confirmations
• Worker onboarding documentation

All records are:

• Securely stored
• Readily accessible for audit
• Retained in line with statutory requirements

Contractual Protection

PGS incorporates JSL protection within its contractual framework by:

• Clearly defining compliance responsibilities
• Prohibiting engagement with non-compliant entities
• Requiring cooperation in audits and investigations

Incident Management

In the event of potential JSL exposure:

• A compliance lead is immediately assigned
• A full audit of affected supply chain elements is conducted
• Relevant agencies/MSPs are notified
• Corrective actions are implemented without delay

Training & Awareness

PGS ensures that:

• Internal staff are trained on JSL risks
• Agencies and partners are educated on compliance obligations
• Updates to legislation are communicated promptly

Governance & Oversight

Responsibility

• Compliance Team: Policy enforcement
• Finance Team: Financial integrity controls
• Directors: Strategic oversight

Audit & Assurance

PGS commits to:

• Regular internal compliance reviews
• External audit readiness
• Alignment with industry standards including:
  • Professional Passport
  • APSCo
  • FCSA

Breach Of Policy

Any breach of this policy may result in:

• Immediate termination of relationship
• Reporting to HM Revenue & Customs where required
• Legal action where appropriate

Continuous Improvement

PGS will:

• Review this policy annually
• Update in line with legislative changes
• Enhance monitoring and reporting capabilities

Conclusion

This Joint & Several Liability Mitigation Policy ensures that People Group Services Ltd:

• Eliminates downstream tax risk
• Provides defensible compliance evidence
• Protects all parties within the labour supply chain

It is a cornerstone of the PGS operating model and reinforces our commitment to:

“Compliance Without Compromise.”

Declaration

This Policy is approved by the Board of Directors of: People Group Services Limited Company Number: 11570329

Last updated: 24th March 2026