Are escort agencies really legal?

Active 14 Replies 2.0K Views 2016-10-26 00:17:41 UK Escort Agencies

I plan to start an escort agency and register with HMRC too. I've been reading an article recently regarding the escort agency owners being jailed for controlling prostitution for gain and money laundering. The above mentioned escort agency has been registered with HMRC too and they were paying taxes. It's very confusing, whether this is legal or not? Can you please advise?

Many thanks

1 Year
Sorry for the late reply Laya

Escort agencies are completely legal as long as you don't break the law. The two main Laws in the UK are centred around controlling prostitution and trafficking.

Controlling Prostitution is basically telling an escort when she works. If you own the premises an escort works from this can also be classed as controlling prostitution.

Trafficking isn't what everyone thinks. You don't have to physically tie a working girl to the bed to fall into the trafficking category. If an escort works for your agency and she doesn't have a work visa in the UK then, according to the CPS (crown prosecution service) you are trafficking the escort.

My advice to any escort agency setting up in the UK is to check passports to make sure the escort is part of the EU so they can legally work in this country. Any escort applying to your agency who is not from the EU should provide you with scanned copies of their work visas. Do not buy and rent out flats to escorts as this can be seen as controlling prostitution. Also the escort must always take the money from the client and then pay your booking fee, never the other way round. If you pay the escort for a booking, again, technically it's controlling prostitution. Do not entertain clients wishing to take or buy drugs. You may get clients phone up asking for party girls which means they are looking for an escort to take drugs with.

There are too many escort agencies in the UK and if one's shut down another one opens. In short the police are only interested in escort agencies breaking the laws i've mentioned above.

An escort agency is simply a booking line. All the escorts in your agency can accept of decline the bookings you pass to them. The escorts tell you when they want to work and how much they charge. You simply collect a booking fee from them. The booking fee is for your online advertising fees.

Make sure you register with HMRC as either a sole trader or a limited company. In my mind being a sole trader is a lot easier as once a year you tell HMRC how much you brought in (your booking fees), how much your expenses are and how much your profit is.

If you did end up in court for anything, once the CPS has finished with you, you're then passed to the tax man. If you have been found guilty of any crimes associated with the website such as controlling or trafficking and you haven't paid your taxes you're in for a rough ride.

I've seen cases where no tax or company has been setup and the tax man will calculate how much you owe them like this.

Website age (1 years) * No. of escorts (10) * Hours in day (5) * Days in year (300) * Hourly Commission (£50)

Let's do the maths:

1 * 10 * 5 * 300 * 50 = £750,000 profit. Taxed at 40% = £300,000 you now owe HMRC

I hope i didn't put you off starting an escort agency? It's a very lucrative industry and done properly you wont have any issues at all.
1 Year
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1 Year
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1 Year
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1 Year
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1 Year
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1 Year
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1 Year
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1 Year
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1 Year
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