Important guidance released from HMRC – anyone working through an umbrella should check both their payslip and personal tax account to ensure that HMRC is receiving appropriate tax and NICs.
This advice in itself is not new news (we have recommended these steps for years), but it is the first time HMRC has issued such specific guidance. The reason for doing these checks is to protect yourself against being unknowingly caught in a tax avoidance scheme.
Assuming you are being paid via payroll, then enter your details into an online salary checker, we like listentotaxman.com, and then check your payslip shows the deductions you expect. Also, check your personal tax account which is HMRC’s record of tax and NICs received in relation to your income. If you haven’t already got a personal tax account, you can easily register online via gov.uk.
HMRC’s guidance reminds you of an important point: YOU are RESPONSIBLE for your own tax affairs.
That means if HMRC don’t receive all the tax and NICs they should in relation to your income then YOU are likely to get a huge future tax bill.
Please please don’t become a victim, just do these simple checks to protect yourself.
You should check your personal tax account whenever you are paid by a new company, just to make sure that HMRC is receiving everything that they should.
HMRC’s guidance is well-written and includes samples of what can go wrong. It’s worth a read and can be accessed here.