HMRC Launches 'Don’t Get Caught Out' Campaign to Help Contractors Avoid Risky Tax Schemes
New guidance, tools, and resources aim to protect contractors from tax pitfalls, ensuring compliance under IR35 and beyond.
HMRC have launched a “Don’t get caught out” campaign aimed at protecting workers from tax avoidance schemes. This is for contractors where there is a higher risk of tax avoidance schemes and so HMRC wants to help them spot bad tax advice. HMRC also want contractors to understand their pay arrangements again to assist preventing issues further down the line.
There is a video and also guidance and interactive tools for contractors to help protect them from avoidance schemes. If you are a contractor it will be worthwhile taking a look at these.
HMRC also publishes a list of known avoidance schemes and the agencies promoting them.
A contractor caught using a tax avoidance scheme will have to pay the underpaid tax plus interest and also possibly a penalty. It should also be noted that there are no HMRC approved tax avoidance schemes.
Contractor rules changed on 6th April 2021; off-payroll working rules for IR35. This was quite a major change and caused a lot of issues when it came into force. Under IR35 workers are processed through payroll and have tax and National Insurance deducted. IR35 is not a tax avoidance scheme but does have quite a lot of complexity to get it right.
Useful Resources:
Umbrella Companies - https://youtu.be/XZUUc8UNb3c
Current list of named tax avoidance schemes, promoters, enablers and suppliers - GOV.UK
https://dontgetcaughtout.campaign.gov.uk/
Ten things that people promoting tax avoidance schemes will not always tell you - GOV.UK