HM Revenue and Customs (HMRC) have issued new guidance to help agencies and employers reduce their risks of using umbrella employers who are operating tax avoidance schemes.
These schemes claim to prevent some payments being taxable. They describe taxable earnings paid for doing a job as something that is non-taxable such as:
- loans
- grants
- salary advances
- capital payments
- credit facilities
- annuities
- profit shares
- shares and bonuses
- amounts held in a fiduciary capacity
These schemes involve untaxed payments being made by a non-compliant umbrella company to increase take-home pay.
Most do not work and are successfully challenged in the Courts, they do not comply with the law. Enablers of tax avoidance schemes may incur penalties.
The full guidance with links to further resources can be found at:
Education
The following buttons link to articles providing more information:
Report tax avoidance
Suspect an umbrella company is not complying with tax rules:
Opinion
The pandemic has seen an increase in scams and fraud in efforts to defraud both government, workers and families. Organisations misleading with half truths, diversion tactics and public claims of full compliance.
Is truth key, or misleading complex language encouraging a good thing,, or not so good when the scam is prevented and stops and the poor worker ends up with significant tax bills.
Too good to be true, then there is a good change it’s not true.
PAYadvice.UK 11/10/2021
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