58.1-3732.4 - Limitation on gross receipts; staffing firms.
§ 58.1-3732.4. Limitation on gross receipts; staffing firms.
A. Gross receipts for license tax purposes under this chapter shall notinclude employee benefits paid by a staffing firm to, or for the benefit of,any contract employee for the period of time that the contract employee isactually employed for the use of the client company pursuant to the terms ofa PEO services contract or temporary help services contract. The taxablegross receipts of a staffing firm shall include any administrative feesreceived by such firm from a client company, whether on a fee-for-servicebasis or as a percentage of total receipts from the client company.
B. For the purpose of this section:
"Client company" means a person that enters into a contract with a staffingfirm by which the staffing firm, for a fee, provides PEO services ortemporary help services.
"Contract employee" means an employee performing services under a PEOservices contract or temporary help services contract.
"Employee benefits" means wages, salaries, payroll taxes, payrolldeductions, workers' compensation costs, benefits, and similar expenses.
"PEO services" or "professional employer organization services" means anarrangement whereby a staffing firm assumes employer responsibility forpayroll, benefits, and other human resources functions with respect toemployees of a client company with no restrictions or limitations on theduration of employment.
"PEO services contract" means a contract pursuant to which a staffing firmprovides PEO services for a client company.
"Staffing firm" means a person that provides PEO services or temporary helpservices.
"Temporary help services" means an arrangement whereby a staffing firmtemporarily assigns employees to support or supplement a client company'sworkforce.
"Temporary help services contract" means a contract pursuant to which astaffing firm provides temporary help services for a client company.
(1998, c. 347; 2005, c. 839.)