What is HMRC’s blacklist?

For recruitment companies and temporary workers that arrange or receive pay through umbrella companies, identifying which ones are compliant and trustworthy is challenging. Even with considerable due diligence, recognising the sophisticated tax avoidance schemes that are widespread in the unregulated contracting payroll market is extremely difficult.

One valuable resource is HMRC's regularly updated list of known tax avoidance schemes in operation. The current list of named tax avoidance schemes, promoters, enablers, and suppliers, is not a complete list of active schemes. Nonetheless, when looking into a payroll provider, checking this list is a good place to start.

"As of the latest update on March 21, 2024, the list comprises 72 entries, with HMRC recently adding seven arrangements contractors are advised to steer clear of."

Understanding how the list functions:

HMRC's list of schemes in alphabetical order gets updated whenever they find and confirm new schemes or the people who run them. But it's important to know that not every scheme that's currently happening is on this list because some manage to stay hidden. Also, they usually take entries off the list after 12 months, to adhere to the law or because of certain circumstances.

In certain instances, HMRC may be unable to disclose information about fraudulent operators, such as during ongoing representations or appeals.

HMRC encourages individuals impacted by listed schemes, or those who recognise any of the involved parties, to reach out. Additionally, reporting any known or suspected tax avoidance schemes not listed is encouraged.

For further insight into the information HMRC can release and the list's management, additional details are available here.

Protecting yourself from fraudulent umbrella companies:

It's crucial to do your research when it comes to selecting payroll companies, as working with unreliable ones can result in issues like incorrect tax payments or missing funds. To stay clear of these problems, opt for companies that adhere to regulations.

By partnering with Giant Group, you can avoid any tax risk as we become the employer of record. We ensure compliance with all legislation including employment status reviews, appropriate tax deductions, and statutory reporting requirements. For more information, please contact us at hello@giantgroup.com