HMRC has used its new powers for the first time to ‘name and shame’ the promoters of two tax avoidance schemes. And the Revenue is warning anyone involved in Absolute Outsourcing’s or Purple Pay Limited’s Equity Participation schemes to leave as soon as possible to prevent them from incurring a large tax bill.
Mary Aiston, Director of Counter Avoidance, HMRC, 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.”
The two named schemes are:
• Absolute Outsourcing, of Foerster Chambers, Todd Street, Bury, Greater Manchester
• Equity Participation Scheme (EPS), promoted by Purple Pay Limited (PPL), of Gracechurch Street, London.
HMRC said both schemes involve individuals agreeing to an employment contract and working as a contractor. The schemes 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.
By releasing the details of these schemes, HMRC is letting taxpayers know as early as possible so they can steer clear of them or exit them. HMRC will also regularly update the list by publishing the details of other tax avoidance schemes and their promoters. If a tax avoidance scheme is not shown in the list, this does not mean that the scheme works or is in any way approved by HMRC.
Naming avoidance promoters is one of a number of measures that HMRC is using to help people identify avoidance schemes. A video highlighting the experience of a critical care nurse who was recommended a tax avoidance scheme through her agency has also been published by HMRC. The video explains the risks of becoming involved in a tax avoidance scheme and the warning signs customers should look out for.
HMRC said that if a taxpayer believes that they are involved in a tax avoidance scheme they should contact them as quickly as possible by calling 0300 053 4226.
News courtesy: https://accountingpracticeonline.co.uk/hmrc-names-tax-avoidance-scheme-promoters/