Background

Misleading Advertising: Edge Umbrella Ltd t/a Edge Umbrella breaks the UK advertising rules for making misleading claims and omissions for the tax arrangements offered on the http://edgeumbrella.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 Edge Umbrella Ltd was challenged by HMRC and subsequently this issue was passed to the Compliance team.

Misleading Statements

The following references on the Edge Umbrella website breach the Enforcement Notice because the arrangement has been challenged by HMRC:

  • “compliant payroll”

  • “ensure you’re paid correctly”

  • “make the correct Tax & NI deductions to the HMRC”

  • “No need to worry about calculating the tax and NIC. We will make all the necessary deductions to the HMRC and pay your salary to your bank account NET of all costs”

On the basis that the tax arrangement offered for umbrella payroll services on the http://edgeumbrella.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 Edge Umbrella 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 Edge Umbrella Ltd and, in the absence of a response, took the decision on 25 January 2023 to place Edge Umbrella Ltd’s company details on this section of the ASA website. These details shall remain in place until such time as Edge Umbrella Ltd t/a Edge Umbrella has appropriately amended the http://edgeumbrella.co.uk/ website to ensure compliance with the CAP Code.


More on