Since 30 September 2017 it will be a criminal offence to help or fail to prevent the facilitation of tax evasion. The security of a compliant umbrella has never been more important, if your umbrella company fails to pay tax or goes into administration it would be you that’s out of pocket.
Can you answer yes to any of the questions below?
- Does your NET take home pay usually exceed 70%?
- Were you sold this on the back of a greater NET take home pay?
- Were you told that you don’t have to declare the scheme?
- Are you paid national minimum wage plus a loan note payment or any other payment not subject to PAYE?
- Were you told that this is a HMRC approved scheme?
If you answered yes to any of the above questions, you are at risk of using a non compliant umbrella company.
What’s the risk?
If you are found to be using a non compliant umbrella scheme this could lead to investigation and prosecution by the HMRC, resulting in:
- Investigation, prosecution and litigation costs
- Repaying all unpaid tax
- Interest payments
Based on the Criminal Finance act 2017, which went live on the 30 September, HCL is legally obliged to conduct an audit on all umbrella companies used by our locums, and will soon be providing a list of compliant companies that can be used. Any deemed incompliant that place our locums at risk of prosecution, can no longer be used.
As you can see we are taking a pragmatic approach to this issue and will soon provide further guidance to provide you full clarity on what the next steps are for you. If you have any concerns regarding your current umbrella company please contact your consultant or email us.