HMRC has launched a new campaign, "Tax avoidance: don’t get caught out," aimed at contractors. The campaign highlights how to identify tax avoidance schemes, warns of the risks, and explains how to report suspicious activity to HMRC. Tax avoidance occurs when individuals manipulate tax rules to pay less than they owe, but those who participate in these schemes ultimately have to pay the full tax amount, along with interest and potential penalties.

HMRC's goal is to prevent people from getting involved in these schemes and assist those who suspect they may already be entangled. By partnering with various organizations, HMRC is providing contractors with resources to better understand the dangers of tax avoidance schemes and how to avoid them.

Under UK law, everyone is responsible for paying the correct amount of tax, even if they have hired someone else to manage their tax affairs or received incorrect advice. Contractors working through agencies or umbrella companies are particularly encouraged to review their pay arrangements to avoid unexpected tax bills.

The campaign features new guidance and an interactive risk checker, helping workers determine whether their contracts could involve tax avoidance. The HMRC's Spotlights series offers examples of these schemes, including Spotlight 60, published in August 2022, which warns specifically about non-compliant umbrella companies and the warning signs to watch for.