In the latest instalment of its collection of guidance on tax avoidance arrangements, HMRC’s Spotlight 64 highlights some of the risks for employment and recruitment agencies of engaging with umbrella companies – particularly where the umbrella company is promoting an avoidance scheme.
The Spotlight document flags the usual signs that a tax avoidance scheme may be involved (eg unusual financial incentives, discrepancies around worker payslips and worker pay) and the risk of reputational damage where an agency gets involved in ‘non-compliant supply chains’. HMRC also notes its powers to pursue enablers of tax avoidance schemes, including the power to name and shame those involved.
The guidance helpfully links through to more detailed guidance on how organisations can protect themselves against the risk of being involved in umbrella company avoidance arrangements.
In the latest instalment of its collection of guidance on tax avoidance arrangements, HMRC’s Spotlight 64 highlights some of the risks for employment and recruitment agencies of engaging with umbrella companies – particularly where the umbrella company is promoting an avoidance scheme.
The Spotlight document flags the usual signs that a tax avoidance scheme may be involved (eg unusual financial incentives, discrepancies around worker payslips and worker pay) and the risk of reputational damage where an agency gets involved in ‘non-compliant supply chains’. HMRC also notes its powers to pursue enablers of tax avoidance schemes, including the power to name and shame those involved.
The guidance helpfully links through to more detailed guidance on how organisations can protect themselves against the risk of being involved in umbrella company avoidance arrangements.
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