Category: Updates

Aggressive Umbrella Arrangements

With the rising cost of living and the contracting market not yet at the level we would hope to see, individuals and organisations are feeling pressure to engage with riskier contractor engagement strategies than usual.
Unfortunately the umbrella market is littered with aggressive tax models posing as legitimate engagement options for contractors who then push their consultants to engage these services.
HMRC have been highlighting some of these with the latest two being Acacia Resourcing Servicing Limited and Marquee Ltd. Their list has an apparent bias towards Loan Charge Schemes and Offshore Schemes but there are some variations in the detail.
Although recently revealed that HMRC must remove these names after 12 months on the list, it at least demonstrates that they are not blind to what is being offered to agencies and contractors.

At the same time, the VAT teams’ Fraud Investigation Service is pursuing recruiters who engage Mini-Umbrella Companies (MUC) and disallowing ALL the input VAT from the invoices paid to the MUC. Very few recruiters have the cash on hand to settle a bill representing 20% of their entire payroll value for the whole period they engaged the MUC with a further 30% of that in penalties.
Even more concerning for recruiters caught up in this, HMRC have been comfortable utilising their debt-transfer powers to move a portion of this liability (often the penalties) onto the directors themselves.
Some recruiters have stated in the past that they are comfortable engaging with MUC as should the HMRC ever catch up with them, they will simply “phoenix” the business. With the penalties being transferred to the director themselves, there is no simple escape from the liabilities.

The candidate shortage has resulted in one benefit with smaller end hirers being more open to individualised IR35 assessments, in many places supported by our IR35 Protect service.
Even government organisations like DEFRA have fallen foul of trusting their entire assessment process to the CEST tool only to find themselves saddled with significant penalties so the appetite for professional guidance has never been higher.
Our IR35 consultants have joined a number of meetings already this year with agency partners and end-hirers to help all parties navigate the legislation and support them to access the highly skilled workforce firewalled behind PSC engagement.
Poor advice has flooded into this environment with recruiters being encouraged to allow risky PSC engagement. In some cases, providers claim that simple changes like ensuring the contractors PSC has a name that doesn’t include the contractors own name is enough to keep them outside of IR35.
In others, organisations push agencies to allow them to make gross payments to contractors Ltd Companies on the basis that by being the fee-payer, the intermediary is shielding the agency from liability. A guarantee of this sort is only as valuable as the intermediary’s own business though, as once the tax bill plus penalties arrive these smaller intermediaries can simply phoenix leaving the HMRC to transfer the debt back up the contract chain to the Relevant Person.
The Relevant Person is defined in s688AA ITEPA 2003 essentially as either the end-hirer or the organisation one step below the end-hirer in the contract chain. In short, you or your client.

We appreciate the challenges placed on recruiters who seek to engage only legitimate, compliant payroll solutions and thank our agency partners for their ongoing commitment to legal compliance and the long-term thinking it represents.
For those recruiters who have found themselves caught up in these schemes, we offer a fully confidential service to review your current position and structure an exit strategy that is least disruptive to your workforce.
The longer you maintain tax-avoidance relationships, the larger the penalties involved and more likely you are to be identified by the HMRC as an introducer.
Symptoms of aggressive scheme promoters:
• Directors with a history of phoenixing companies
• Directors with hundreds of small companies under them
• Companies registered offshore e.g Philippines & India, Isle of Man
• Payslips for an agency using different PAYE references
• So called FREE schemes – i.e no margin charged to the worker
• High rebates to agencies
• High take home pays promised

For a confidential discussion on the subject, please contact us using the details below and speak to one of our specialists:
Call us: 0333 121 2001
Email us:

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Bureau & PEO

Bureau and PEO proposal – Save you money – Reduce your payroll costs

Many of our clients find that running an internal PAYE function is not cost or time effective. In some cases, their PAYE engagement is managed through their funding supplier, reducing their market options.
Taking control of that function gives them the flexibility to choose the right funding supplier for them and find the best deals on the market.
For other clients, the cost of maintaining an internal payroll team and the key-person vulnerability this gives them is a concern.
For these clients, outsourcing the administration and even the engagement of their pool of workers can be beneficial.
NumberMill provides three models which can help streamline the payroll process whilst maintaining PAYE engagement for the workforce.

PAYE Bureau

• You are the employer.
• NumberMill takes payroll data from you, processes the payroll through our software, reports figures to HMRC against your PAYE reference, reports data to your pension supplier, produces payslips and payroll reports. NumberMill sends payslips via your nominated email account to the employees.
• You supply NumberMill with all payroll related data, new starter information, finishers and weekly hours/rates. You handle all contractor interactions barring payslips, with our support.
Our PAYE Bureau service comes in 3 levels for you to choose what is best for your organisation:

Admin Only
• After processing the payroll, a payment file will be sent to you for you to make payments to the employees from their bank (dependent on your online banking accepting payment file uploads)
• NumberMill invoice will only be for NumberMill charge and will be vatable

Admin & Payment
• After processing the payroll, NumberMill will make the payments to the employees from our bank
• NumberMill invoice will be for NumberMill charge and will be vatable and for the employees net pay which will not be vatable.

Admin, Payment & Liabilities
• After processing the payroll, NumberMill will make the payments to the employees from our bank
• NumberMill invoice will be for NumberMill charge, the employees net pay, the tax and national insurance due to the HMRC for the worker. The entire invoice will be vatable.
• When due, NumberMill will make payment to the HMRC against your PAYE reference for your P32 liabilities (the withheld tax and NI)

NumberMill PEO – Professional Employment Organisation

Employing a workforce does not only take up time in the payroll processing, but also the boarding, issuing of contracts and handling of payroll queries.
For organisations wishing to focus on what they do best, we offer our Professional Employment Organisation service.

NumberMill PEO
• NumberMill are the employer and following an on-boarding call, issues a contract of employment to the employee
• NumberMill takes payroll data from you, processes the payroll through our software, reports figures to HMRC against our PAYE reference, reports data to our pension supplier, produces and issues payslips to the employee
• We invoice you for the employee’s gross pay, holiday pay, statutory on-costs and our margin
• The worker receives a simple PAYE payslip with no on-costs showing
• NumberMill handle all payroll updates and queries from the employee.

Some of our clients prefer to know in advance the hourly cost of their workforce. For these clients we can offer NumberMill Fixed Price PEO.
You simply inform your NumberMill consultant of the hourly budget you have or the PAYE rate you wish to offer. Your consultant will advise you of the fixed hourly cost or the maximum PAYE rate NumberMill can offer within that budget.
From there, the employee’s experience is identical for NumberMill PEO but you have the peace of mind of knowing exactly the hourly budget of engaging that worker.

For a confidential discussion on the subject, please contact us using the details below and speak to one of our specialists:
Call us: 0333 121 2001
Email us:

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March 2023 Budget

The Chancellor of the Exchequer, Jeremy Hunt, outlined the government’s latest plans to grow the UK economy with policies underlines as “Enterprise, Employment, Education, Everywhere”.
Opinion – somewhat disappointing, particular in regards to
  • Nothing real for business unless in a niche sector – No change to Corp Tax or any increase in liftetime allowance for business assest disposal
  • Childcare welcomed, however timing is erroneous – due to having to get infrastructure in place, I am sure if the funding was immediate providers would get that in place quicker.
  • Pension benefit – The benefit really is for the highly paid public sector worker who can afford to put in £60k a year


The chancellor Jeremy Hunt announced during the Spring Budget 2023, the main priorities of the government are to halve inflation, grow the economy and get debt falling.
In January 2023 the prime minister set a target to reduce inflation by 50% by the end of 2023 from the rate at the time of 11.1%, the highest in 40 years. The current expectation is for inflation to reduce to 2.9%, significantly surpassing the targeted inflation decrease.
The government are looking to grow the economy through increased employment numbers by both incentivising and enabling employment for anyone able to work. This will be achieved through increased access to childcare for parents, access to additional resources for those with disabilities to enable them to find jobs they are capable of and providing over 50s with resources to allow them to continue working rather than retiring early.
The current debt stands at £2.5 trillion which represents 98.9% of GDP. The chancellor advised that the main aim will be to reduce borrowing for day to day spending while increasing borrowing for long term investments. Borrowing is currently £24.7 billion lower than the November 2022 forecast. The aim is to bring borrowing down to 1.7% of GDP by 2027-28.
An overview of the key Spring Budget updates have been included, with full details linked below.


Due to the “Pension Trap” which has resulted in experienced doctors retiring early, the maximum pension contribution has been increased by 50% from £40,000 to £60,000 per year and the previous pension lifetime allowance of £1,073,100 has been abolished.


Originally the £2,500 energy cap guarantee was expected to increase to £3,000 from April 2023 onwards, however has been adjusted due to energy costs dropping allowing the cap to remain at £3,000 until the end of June 2023.
The government is committed to investing:
  • £20 billion in carbon capture technology with the aim to capture 22 million tons of carbon by 2030.
  • Investment in nuclear energy with the aim to have 25% of British energy be nuclear by 2050.
  • Nuclear energy to be reclassified as environmentally friendly and receive the same allowances as other environmentally friendly forms of energy.

Levelling up

Over £200 million put towards local regeneration projects in areas of need.
Over £400 million for new levelling up partnerships for 20 areas in England.
12 investment zones in the UK set around universities will be given a budget of £1 billion to promote business growth in these areas.
£8.8 billion over five years towards City Region Sustainable Transport Settlements

Business Tax

Research and Development tax credits for businesses which spend 40% or more of total expenditure on Research and Development. Tax credit received will be at 27% of total investment.
The Super-Deduction for capital expenditure will be removed from April 2023 onwards, however this will be replaced with full capital relief on the majority of capital expenditure.

Education and childcare

Priority for education is to allow parents better childcare to allow them to continue to work.
Minimum nursery staffing requirements to be decreased from 1 adult to 4 children to 1 adult for 5 children.
Schools to operate a wraparound care scheme to offer parents with primary aged children care before and after school ranging from 8am to 6pm.
Universal credit to allow for parents to immediately receive refund for spending on children rather than weeks in arrears. Additionally Universal Credit will be increased from £646 a month per child to £951 for one child and £1,630 for 2 children.
Parents with children under 3 will receive 30 hours a week in free childcare for up to 38 weeks a year. this is aimed to be expanded to children aged 3-4 from April 2024.


Offering a Midlife MOT for over 50s to ensure health and career guidance ahead or retirement.
People with disabilities will be able to search for employment without the risk of losing their disability benefits.
Up to £4,000 per person budget to help disabled people find suitable role and cater to their needs.


£900 million of funding towards an AI research resource
£2.5 billion commitment to 10 year quantum research in innovations program.
Tax reliefs offered for the Arts industry to reduce economic pressure.


Defence will receive an extra £5 billion in funding over the next 2 years and £2 billion a year in addition funding going forward.
Military funding expected to be at 2.5% of GDP, 0.5% above minimum requirement.

Get in contact with us to find out how our services can help you and your business, using the details below:
Call us: 0333 121 2001
Email us:

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