Disguised remuneration: job board avoidance scheme

20 March 2017


HMRC is aware of a new disguised remuneration tax avoidance scheme that attempts to avoid Income Tax and National Insurance contributions (NICs) by paying contractors in the form of redeemable loyalty points.

This scheme doesn’t work and HMRC will investigate all users of the scheme.


How the scheme works

The contractor becomes an employee of an umbrella company and is then paid in two parts. The first part is a small basic wage with little or no tax and NICs deducted. The second part of the payment is used to advertise the contractor’s services on a job board.

They immediately receive loyalty points in return for keeping their details on the job board. The loyalty points can be cashed in by the employees shortly after, with no deductions made for tax or NICs. The contractor usually has to pay a large fee to the third party running the job board.


Read more from HMRC’s Spotlight 37 on:

  • why you shouldn’t use the scheme;

  • what will happen if you do; and

  • what to do if you are using the scheme.