Potential indicators of tax avoidance arrangements for individual agency workers and contactors who are moved between umbrella companies are highlighted by HMRC in Spotlight 71. The signs to look out for include:
- being unexpectedly moved to a new umbrella company signing a contract with one company but being paid by a different one or being asked to sign more than one employment contact;
- changes to details and amounts on payslips such as discrepancies between the amount of pay declared and the amount actually paid; and
- being moved to a new payroll system without warning – HMRC says this could be a sign the old company is non-compliant and that it is already investigating it.
HMRC emphasises that it is the worker’s responsibility to make sure they know how much tax and National Insurance they should be paying. It recommends that a worker with concerns...
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