Background
Misleading Advertising: DG Resources Ltd breaks the UK advertising rules for making misleading claims and omissions for the tax arrangements offered on the https://dgresources.co.uk website.
Together with HMRC, the CAP Compliance team has been taking market-wide action about the advertising of tax arrangements. As part of this work we published our joint Enforcement Notice - Advertising Tax Arrangement Schemes.
The Notice applies to websites which advertise a tax arrangement to UK individuals or businesses that has been challenged by HMRC. The tax arrangement advertised by DG Resources Ltd was challenged by HMRC and subsequently this issue was passed to the Compliance team.
Misleading Statements
The following references on the DG Resources website breach the Enforcement Notice because the arrangement has been challenged by HMRC:
- "With an umbrella service you can have all the freedom of being a contractor, with the benefits of being an employee"
- "You will become an employee of DG Resources, and by doing so become compliant with IR35 legislation"
- "Umbrella Benefits With an umbrella service you can have all the freedom of being a contractor"
- "Holiday Pay - As an employee you will be entitled to holiday pay. This can be setmaside for you or advanced"
- "Offer valuable support with regards to the latest legislation affecting your candidates"
- "When a contractor joins an umbrella, they will sign an employment contract and the umbrella will effectively become their ‘employer'"
On the basis that the tax arrangement offered for umbrella payroll services on the https://dgresources.co.uk website has been challenged by HMRC, and contractors using the scheme may not be paying the correct tax and National Insurance contributions, we consider these statements are likely to mislead consumers.
Omissions
Ads for schemes under HMRC challenge may be advertised – but it is particularly important to be clear and upfront about the potential risks to customers of entering into the challenged arrangement.
HMRC investigation does not necessarily mean that a claimed tax advantage will not be upheld. It does mean, however, that there is a risk that the scheme will not successfully deliver the tax advantages claimed, which should be disclosed. Omission of the disclosure of risk of entering the scheme is a problem.
The DG Resources website has not laid out any of the risks of entering into their tax arrangement as laid out in the Enforcement Notice.
The CAP Compliance team contacted DG Resources Ltd and, in the absence of a response, took the decision on 12 March 2025 to place DG Resources Ltd’s company details on this section of the ASA website. These details shall remain in place until such time as DG Resources Ltd has appropriately amended the https://dgresources.co.uk website to ensure compliance with the CAP Code.
