The Upper Tribunal has closed another door on offshore NIC planning. In Aramark Limited v HMRC [2026] UKUT 348 (TCC) (released 9 September 2026), Mr Justice Richards and Judge Nicholas Aleksander dismissed Aramark’s appeal and upheld secondary Class 1 NIC liability of about £6.83 million (plus interest) for 6 August 2011 to 5 April 2014.
The structure was familiar: a UK operating company contracted to deliver catering and hotel services on North Sea installations, while a US group entity employed the crew. Aramark believed the foreign employer sat outside UK secondary NIC. HMRC said the workers’ personal service was “made available” to Aramark as host employer under paragraph 9 of Schedule 3 to the Social Security (Categorisation of Earners) Regulations 1978. The UT agreed on outcome — and locked the legal test so day-to-day host control is not a statutory precondition.
For CFOs in PE portfolios, multi-nationals, oil-and-gas contractors or any UK entity that “borrows” labour from a foreign affiliate, this is a substance-over-form control test on secondments and intercompany manning — not a niche continental-shelf story.
What the tribunal actually decided
Aramark is the UK member of a US-headed group. It contracted with offshore installation operators to supply personnel, goods and equipment for hotel and catering services. From October 2004 to March 2017 it met some of those obligations using crew employed by Aramark US Offshore Services LLC (OSI) under a June 2005 Intercompany Agreement. Staff previously employed by Aramark transferred to OSI. OSI had no UK residence, presence or place of business, so it was common ground OSI itself was not a secondary contributor.
HMRC assessed Aramark under the host employer provision for the recoverable window 2011–2014. From 6 April 2014 legislative changes meant Aramark accepted liability going forward; time limits blocked earlier years. The sole live issue was whether OSI employees’ personal service was “made available” to Aramark and “rendered for the purposes of” Aramark’s business.
The FTT had already dismissed the appeal in [2024] UKFTT 832 (TC). It found OSI was “little more than a contractual shell”: formal HR and finance decisions on Aramark recommendations, no substantive day-to-day direction of crew, allocation by Aramark logistics, and operational manuals owned by Aramark. The Upper Tribunal has now affirmed the outcome while correcting the legal map. Claritax News has a clean note; the National Archives judgment is the primary board source.
The host employer provision in plain English
Secondary Class 1 NICs normally sit with the employer under the Social Security Contributions and Benefits Act 1992. Section 7(2) lets regulations re-characterise the secondary contributor. Paragraph 9 of Schedule 3 to the 1978 Regulations (as it stood for the relevant years) catches employment by a foreign employer where, in pursuance of that employment, the worker’s personal service is made available to a host employer with a place of business in Great Britain, the service is rendered for the host’s business, and it begins on or after 6 April 1994. The host then becomes the secondary contributor.
The 1994 explanatory note said the change targeted workers seconded by foreign employers to employers in Great Britain. Continental Shelf workers are treated as gainfully employed in Great Britain under the contributions regulations, so the territorial fiction does not save the structure. The same engine runs through Bilfinger Salamis UK Ltd v HMRC [2026] UKUT 143 (TCC), Odfjell Technology and Wood Group Engineering (North Sea). The UT noted it was unfortunate the appeals were not heard together. Treat them as one risk family.
Control is not the gate
This is the point that changes the memo. The FTT had treated control unevenly: “made available” did not require host control, but “rendered” supposedly needed day-to-day granular direction. After Bilfinger, the UT held that the ordinary meaning of “made available” and “rendered” does not require the host to exercise day-to-day control as a matter of law. The FTT therefore erred to the extent it treated some host direction as necessary — but the error was immaterial under the Court of Appeal approach in Degorce, because the factual outcome would not have changed.
In short: you do not need to prove the UK company managed every shift to lose. Putting workers at the disposal of the UK host for its business is enough. Contract labels of “subcontract” or “composite service supply” do not defeat the provision if the reality is secondment-like access to personal service. Even on Aramark’s preferred control-heavy test, the FTT findings (Aramark allocating crew; OSI not directing day-to-day work; Aramark-owned offshore manuals) still sank the appeal. Addleshaw Goddard’s Tax Journal briefing How to be a good host (employer) makes the same practical point: tribunals look past labels to who benefits from the labour.
Why the “composite service” argument failed
Aramark’s fallback was Edwards v Bairstow territory: no reasonable tribunal could have found secondment-style availability rather than a complete catering service from OSI. The UT rejected that. The Intercompany Agreement left OSI with a thin ratification role. Physical delivery procedures lived in Aramark documents never reviewed by OSI management. Unit managers ran platforms off Aramark’s offshore manual. Crew allocation sat with Aramark.
If your UK OpCo still wins the customer contract, sets operating and HSE protocols, allocates people to sites, runs payroll admin and manning recommendations, and treats the foreign affiliate as a paper employer for cost advantage, then “we bought a complete service from offshore” will struggle. The tribunal will ask whether personal service was put at the UK company’s disposal for its business. In Aramark, the answer was yes.
What every CFO must lock now
1. Map every foreign-employer labour feed into a UK place of business. Secondments, intercompany crew supply, Guernsey/US/Irish employing entities, global-mobility cost-plus arrangements, and PE portcos that inherited offshore manning structures all belong on one schedule — including periods still open under NIC decision time limits.
2. Re-read the host employer clause against Bilfinger + Aramark, not the 2004–2014 planning memo. The statutory purpose was secondment capture. The UT will not invent a control threshold the statute does not state. If the defence hangs on “the UK company did not line-manage anyone,” rewrite it.
3. Separate true composite subcontracting from personal-service availability. A genuine third-party facilities contractor delivering an output under its own systems, supervision and commercial risk differs from a group foreign employer whose workers are slotted into the UK OpCo’s customer obligations. Document who issues instructions, who owns SOPs, and who can reallocate labour.
4. Quantify residual NIC, interest and PAYE interaction. One recoverable window was £6.83m secondary Class 1 plus statutory interest. Board packs should show gross exposure, open periods, follow-on employment-tax risk, and whether disclosure or settlement is cleaner than litigation.
5. Align employment-tax, payroll and transfer-pricing files. The same facts drive agency/off-payroll analyses, permanent establishment questions, and whether intercompany charges look like staff secondment or a real services supply. HMRC’s GfC19 on short-term business visitors is a useful parallel control lens for inbound labour.
6. Do not assume 2014 reforms closed the history file. Aramark accepted liability from April 2014; the fight was the pre-change window. Related appeals still have permission granted. Historic “NIC-efficient” structures need an explicit still-open / closed / disclosed status in the tax risk register.
7. PE deal teams: put host-employer NIC in the employment-tax workstream. On buy-side diligence, ask for foreign employing entities, intercompany labour agreements, operator subcontract clauses and any HMRC NIC decisions. On exit, buyers will price open secondary NIC like open IR35 — locked box or escrow.
Wider employment-tax stack
Aramark sits beside other live controls. Off-payroll working still polices labour chains where the UK end-user is not the contractual employer — different statute, same substance instinct. Mandatory BiK payrolling from April 2027 (phase 1: cars, fuel, vans, medical) pushes real-time employment-tax reporting; see HMRC’s draft guidance. The agent MFA final window (28 September–15 October 2026) is process, not technical tax — but locked-out accounts during an NIC disclosure are avoidable failure (Tax Agent’s Handbook; CIOT/ATT; ICAS).
Board one-pager
- UT confirmed host-employer secondary NIC can bite without a statutory control test.
- £6.83m plus interest on one window is board-scale quantum.
- Foreign group employers plus UK customer delivery is a red-flag pattern, not a safe harbour.
- Related appeals mean HMRC has a playbook beyond catering on rigs.
- Action: labour-supply map, legal refresh against Bilfinger/Aramark, quantify open years, decide disclose/defend/settle.
Bottom line
Aramark tried to manufacture an NIC-free labour cost by parking the employment contract in a US entity while the UK company kept the customer, the manuals and the manning decisions. The Upper Tribunal has now said — consistent with Bilfinger — that “made available” is ordinary English aimed at secondment reality, not a control puzzle the taxpayer can game. Personal service put at the disposal of a UK host for its business engages the host employer provision.
Lock the map. Re-test every foreign-employer feed. Price the open years. And stop treating intercompany crew supply as a pure transfer-pricing footnote when secondary Class 1 can still rewrite the cash cost of every hour worked on a UK job.
Tanous Limited advises PE-facing CFOs and boards on tax, accounting and finance operating risk. This article is general information, not advice on any specific arrangement. Read the judgment, then apply professional judgement to your facts.