HM Revenue & Customs (HMRC) has released its latest update to the HMRC avoidance list, with changes published on 9 April 2026. The update forms part of HMRC’s ongoing efforts to identify and tackle tax avoidance arrangements within the contractor and umbrella company market.
For contractors, recruitment agencies and end clients, this serves as an important reminder to review payroll arrangements and ensure full compliance with PAYE regulations.
The full list can be viewed on HMRC’s official website:
https://www.gov.uk/government/publications/named-tax-avoidance-schemes-promoters-enablers-and-suppliers/current-list-of-named-tax-avoidance-schemes-promoters-enablers-and-suppliers
Understanding the HMRC Avoidance List
The HMRC avoidance list is a publicly available register that names businesses HMRC believes are involved in promoting, enabling or supplying tax avoidance schemes.
These arrangements are often marketed to contractors as a way to increase take-home pay. However, they typically involve structures that do not correctly apply Income Tax and National Insurance contributions.
HMRC’s position is clear: individuals using such schemes may still be required to pay the full amount of tax owed, along with interest and penalties.
What Changed in the April 2026 Update?
The update published on 9 April 2026 continues HMRC’s regular revisions to the HMRC avoidance list. While specific additions can vary between updates, HMRC uses these releases to:
- Identify newly suspected promoters and suppliers
- Provide updated details on existing entries
- Increase transparency across the contractor supply chain
This ongoing approach reflects HMRC’s increased focus on umbrella companies and intermediary payroll providers operating outside standard PAYE frameworks.
Why This Matters for Contractors
For contractors working through umbrella companies, inclusion on the HMRC avoidance list is a clear warning sign.
Arrangements linked to named providers may involve:
- Payments that are not fully taxed through PAYE
- Split income models combining taxed and untaxed elements
- Offshore or complex payment structures
- Claims of unusually high take-home pay
If HMRC later challenges these arrangements, contractors could face:
- Retrospective Income Tax liabilities
- National Insurance contributions
- Interest and financial penalties
Even where a contractor was unaware of the structure, responsibility for unpaid tax may still apply.
Implications for Agencies and End Clients
The impact of the HMRC avoidance list extends beyond individual contractors.
Recruitment agencies and end clients must also ensure that payroll providers within their supply chain operate compliant models. Failure to carry out due diligence can lead to:
- Financial risk
- Reputational damage
- Increased scrutiny from HMRC
As a result, regular checks of the HMRC avoidance list should form part of standard compliance procedures.
How to Stay Compliant
To reduce risk, contractors and agencies should take a proactive approach to compliance:
- Review payslips to confirm all income is taxed via PAYE
- Question any arrangements offering unusually high take-home pay
- Avoid structures involving loans, advances or offshore payments
- Seek independent advice if unsure about a payroll model
Most importantly, working with a transparent and compliant umbrella company is key.
You can view providers in our Top 10 Umbrella Companies.
HMRC’s Continued Focus on Tax Avoidance
The April 2026 update highlights HMRC’s continued commitment to tackling non-compliant arrangements across the contractor sector.
With enhanced powers to publish details of suspected promoters earlier, HMRC is taking a more proactive approach to disrupting tax avoidance schemes before they become widespread.
For contractors and agencies, this means increased visibility, but also increased responsibility to ensure compliance.
Final Thoughts
The HMRC avoidance list remains an essential resource for identifying potential risks within the umbrella company market.
The update published on 9 April 2026 reinforces the importance of due diligence, transparency and compliance. Contractors and agencies should regularly review the HMRC avoidance list and ensure all payroll arrangements meet HMRC requirements.
Taking action early can help avoid significant financial consequences later.
