Agency body 'shocked' at scale of abuse on mini umbrellas

Agency trade body, APSCo, has said that it is shocked at the scale of the abuse in recent reports about the use of 'mini umbrella schemes'.

According to BBC reports more than 40,000 people from the Philippines have been recruited to front British companies as part of mini umbrella schemes resulting in lost tax revenue.

BBC Radio 4's File on 4 discovered more than 48,000 of these companies have been created in the past five years and that some staff at Covid test centres run by G4S have been employed by subcontractors in this kind of scheme.

G4S said that, when this came to its attention, HMRC was notified and that it was taking steps to ensure that all agency workers were employed directly and not via a subcontractor.

This is the latest black mark on umbrellas following recent calls on the Government from a Parliamentary Group to clean up the 'Wild West' supply chain that exploits freelance and contract workers and encourages tax avoidance schemes.

APSCo - due diligence

Tania Bowers from APSCo said: "The recruitment sector needs to be aware of risks across their umbrella supply chains which is why APSCo insists that all umbrella companies wishing to become APSCo Trusted Partners must go through a robust due diligence process.

"We also work with other bodies such as Professional Passport and the FCSA to ensure umbrella companies are audited and work in close contact with HMRC and BEIS as well as The Association of Compliance Organisations (ASCOR).

"We expect our members to offer workers a choice of umbrella companies and recommend an Approved Supplier List of APSCo Trusted Partners, FCSA and Professional Passport members which offers both choice in number and compliance protection for clients and workers. We have worked on this basis for several years and this is in alignment generally with frameworks issued by the Crown Commercial Services.

"APSCo provides regular guidance to educate everyone in the supply chain to ensure that non-compliant and unscrupulous providers are not being used."