The rules are another example of HMRC requiring businesses to police tax compliance across their supply chains, write Penny Simmons and Steven Porter (Pinsent Masons).
The UK Government’s recent proposals to combat tax avoidance using umbrella companies demonstrate its continued focus on the taxation of off-payroll workers and preference for using businesses as a conduit for enforcing tax compliance and preventing avoidance.
From April 2026 where workers are engaged to provide services to a business via an umbrella company the agency or business contracting with the umbrella company will become legally responsible for ensuring that the umbrella company operates payroll correctly through the PAYE system and that the correct amounts of tax and NICs (including employers’ NICs) are paid to HMRC.
Background to the latest proposals
For over 20 years HMRC have sought to combat tax avoidance in relation to the use of off-payroll workers; introducing...
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The rules are another example of HMRC requiring businesses to police tax compliance across their supply chains, write Penny Simmons and Steven Porter (Pinsent Masons).
The UK Government’s recent proposals to combat tax avoidance using umbrella companies demonstrate its continued focus on the taxation of off-payroll workers and preference for using businesses as a conduit for enforcing tax compliance and preventing avoidance.
From April 2026 where workers are engaged to provide services to a business via an umbrella company the agency or business contracting with the umbrella company will become legally responsible for ensuring that the umbrella company operates payroll correctly through the PAYE system and that the correct amounts of tax and NICs (including employers’ NICs) are paid to HMRC.
Background to the latest proposals
For over 20 years HMRC have sought to combat tax avoidance in relation to the use of off-payroll workers; introducing...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
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