Accountants SJD have been approved by accountancy firm KPMG as being compliant with the government's managed service company (MSC) legislation.

SJD claims this move ensures that recruiters who recommend their services to contractors won't be liable for the contractors' unpaid taxes.

Anne Fairweather, head of public policy at the Recruitment and Employment Confederation (REC), told Recruiter: "This gives recruiters some surety." However she warned KPMG's approval was "not necessarily" Her Majesty's Revenue & Customs' (HMRC) approval and HMRC could take a different view.