These models include for example;
- Offshore arrangements
- Loan Charge arrangements
- Mini Umbrella / Shell Company model (Flat rate VAT manipulation schemes)
HMRC are very well aware of these arrangements and have been seriously clamping down on them.
For the higher paid contractors
, the Offshore and Loan Charge arrangements are now resulting in retrospective claims.
For lower paid workers,
the largest area of non-compliance is the manipulation of workers into schemes known as Shell Company or Mini Umbrella.
Again HMRC are more than aware of these schemes and are actively clamping down on them, through the use of Transfer of Debt Liability and the Criminal Finance Act.
To the untrained eye, the worker will appear to be PAYE and all taxes paid. However, in the background, workers are being put into mini companies, where surplus flat rate vat and the annual allowance is utilised to create an income for the aggressive intermediary.
Agencies if found to be utilising such schemes will come under fire from HMRC.
