HMRC names avoidance scheme promoters

HMRC names avoidance scheme promoters

Tax avoidance scheme promoters have been ‘named and shamed’ for the first time by HMRC, as users are warned they could face large tax bills.
HMRC urged anyone involved in Absolute Outsourcing’s or Purple Pay Limited’s Equity Participation Scheme to withdraw from them as soon as possible to prevent building up a large tax bill.
This is the first time HMRC has used new powers to name tax avoidance schemes and their promoters as part of a campaign to warn the public not to get caught up in tax avoidance.
Both schemes involve individuals agreeing an employment contract and working as a contractor. They pay contractors the National Minimum Wage, with the remainder of their wage paid through a loan to try to avoid National Insurance and income tax.
Mary Aiston, HMRC’s Director of Counter Avoidance, said: “These schemes are cynically marketed as clever ways to pay less tax. The truth is they rarely work in the way the promoters claim and it’s the users that end up with big tax bills.
“New legal powers allow us to name promoters and the schemes they peddle much faster, and this announcement is just the first step. But we need the public to be vigilant, and that’s why we’re also helping people identify, and steer clear, of these schemes through our Tax Avoidance – Don’t Get Caught Out campaign.”