The HMRC has added two more tax avoidance schemes to its naming and shaming list. The most recent update was on 23 February 2023 with the addition of Canopaye Limited and Integra Resourcing Limited (Malta).

For Canopaye Limited, the arrangements involve users providing their services to end clients through the company. The users also sign an agreement that sees the users grant Canopaye an option on an annuity agreement. The result is the payment for their services is artificially separated into a salary and payments said to be in return for the option. No tax or National Insurance contributions are deducted in relation to the payments for the option.

In Integra Resourcing Ltd, registered in Malta (‘IRL’), also named as Target Umbrella Ltd, registered in the UK, users sign separate employment contracts with Integra Resourcing Ltd and Target Umbrella Ltd. Users also sign an ‘Overarching Agreement’ with Integra to provide ‘loans’ to the user. Target Umbrella signs a contract for services with the agency or the end client to provide the services of the user. Target Umbrella then invoices the end client for the work undertaken by the user. Target Umbrella pay users a salary in line with the National Minimum Wage Act for time worked and pays the remaining amount to Integra. Integra then pays the user a second nominal salary, per payroll run, usually below £10, and a larger amount, described as a ‘loan’. The ‘loan’ amount is not taxed.

HMRC’s full list of named tax avoidance schemes, promoters, enablers and suppliers can be found here.

HMRC said naming avoidance promoters is one of a number of measures that HMRC is using to help people identify avoidance schemes as a part of the Tax Avoidance – Don’t Get Caught Out campaign.

There are other schemes, promoters, enablers and suppliers that HMRC cannot publish information about at this time. This may be because HMRC is gathering information about the promoter, enabler, supplier or avoidance schemes being marketed; HMRC is considering representations from a promoter, enabler or supplier; the appeal period for not withdrawing a stop notice has not ended; or HMRC is not aware of the tax avoidance scheme, promoter, enabler or supplier.

Crawford Temple, CEO of Professional Passport, an independent assessor of payment intermediary compliance, said, “It’s been nearly a year since HMRC started its naming and shaming campaign and while it is to be applauded it is simply not efficient and effective enough. The list as it stands demonstrates that there is a serious problem, but this is just the tip of the iceberg and there are many more thousands of schemes thriving and duping people out of their money.  HMRC needs to step up its enforcement quicker. They have the information they need to close down these schemes and need to join the dots faster.”