Letter from HMRC regarding possible involvement in Tax avoidance

[Fred Bloggs]

I'm not so sure - the application to strike off the second company was made at the end of April (and refused in June) while the OP was looking at this back in March.

I suspect back in March anywhere that would raise alarm bells.

I don't think I am agreeing with you here.

Subject brolly was incorporated in October 2018. OP was offered a standard PAYE employment deal or a scheme earlier this year. He wisely chose PAYE. OP mentions a "broker". A "broker" being involved in this smells to high heaven. "Brokers" promote schemes, there is no business in promoting just PAYE. OP was very lucky this promoter/broker actually offered PAYE at all.

Likely that many users routed through this "broker" will have chosen the scheme over PAYE. Hence, HMRC are thinking that everyone employed with the subject brolly is a scheme user.

Makes perfect sense to me. Again, well done to the OP who was sensible is his choice. But now, I would draw a line under this by quitting this brolly and starting with a new, fully compliant non-scheme associated brolly on Monday. With a line drawn under this and a P45 to show Hector, the OP might just be home and dry if he does as I suggest?

[eek]

My point was that back in March beyond the "broker" there was little to say that "Turnkey" was dodgy

And while we know in detail how umbrella firms work we cannot assume other people know what to watch out for.

[Fred Bloggs]

My point was that back in March beyond the "broker" there was little to say that "Turnkey" was dodgy

Neither of us have the slightest idea. Here, I would tend to think along the lines of most probable explanation.

An apparently successful business offering PAYE from 2018 has no incentive to go dodgy and eventually trash it's reputation. A PAYE employment business cannot afford to pay a broker (a scheme promoter) commission.

On the otherhand, a dodgy brolly offering "solutions" from 2018 has every incentive to pay brokers/promoters and to offer some PAYE payroll if someone asks for it.

Balance of probabilities? In my opinion, you were on the money with your option 2. OP has had a very lucky close encounter that could have bitten him very hard if he had been a bit greedier/naive than he was.

[Fred Bloggs]

My point was that back in March beyond the "broker" there was little to say that "Turnkey" was dodgy

And while we know in detail how umbrella firms work we cannot assume other people know what to watch out for.

After your edit - OP says he knew about dodgy schemes. So he sensibly chose PAYE. Where he went a bit awry, was not scratching a bit deeper below the surface veneer. Of little consequence now. OP made a sensible decision and I recommend he draws a line under this and moves on.

[eek]

Balance of probabilities? In my opinion, you were on the money with your option 2. OP has had a very lucky close encounter that could have bitten him very hard if he had been a bit greedier/naive than he was.

It's worth saying that I don't think any broker was involved - it was a mere sales pitch to identify which way to direct the OP.

[Fred Bloggs]

It's worth saying that I don't think any broker was involved - it was a mere sales pitch to identify which way to direct the OP.

That's indeed possible, can't rule it out. But there's no evidence to support that. If this is a reputable brolly and they are a member of a trade association and the agency too if it comes to that. The trade body needs to investigate their business practices. They won't though. One thing I have learned through life is that accreditations and the like are meaningless when it comes to safeguarding the client.

[LondonManc]

After your edit - OP says he knew about dodgy schemes. So he sensibly chose PAYE. Where he went a bit awry, was not scratching a bit deeper below the surface veneer. Of little consequence now. OP made a sensible decision and I recommend he draws a line under this and moves on.

If they give you a full PAYE illustration which matches with an umbrella calculator, most people would, not unreasonably, assume that the company knew what they were doing, especially to make it onto an agency PSL (yeah, I know...). No mention of loans, enhanced this or that, just straightforward umbrella PAYE vehicle.

I still think HMRC are playing guilty by association and shaking the tree and see what falls out. OP should say that they were offered two options and went with the straightforward PAYE option because they didn't want any potential complications and understood it from their own visit to an umbrella calculator site.

[northernladuk]

OP.. How are you getting on with this?

[jimmy899]

Still waiting to hear back from HMRC.

[jimmy899]

So a brief update.

Never heard back from HMRC in regards to the authenticity to the letter, despite they assuring me during the phonecall they will get in touch.

Instead i did get another letter from them asking me to provide documentation, correspondence, bank statements, payslips relating to my association with this umbrella company so that they can check if i have paid the right amount of tax. And they are asking for this for the period between april 2020 and august 2021.

Anyone had similar request from them?