Guidance

August 2026 issue of the Employer Bulletin

Published 19 August 2026

Introduction 

In this month’s edition of the employer bulletin there are important updates and information on: 

PAYE

Tax updates and changes to guidance

General information and customer support 

HMRCs support for customers who need extra help 

HMRC’s principles of support for customers who need extra help set out our commitment to support customers according to their needs and underpin the HMRC Charter. 

Find out how to get help and the extra support available. 

PAYE

Tax fraud warning for employment agencies and employers — schemes claiming to reduce liabilities using tax credits

HMRC has published a tax fraud warning for employment agencies and employers brief to raise awareness of new fraudulent models which are being marketed to employers and recruitment agencies offering ‘cheaper’ payroll services.

Organised crime groups are particularly active in the temporary employment agency and recruitment sector.

HMRC is here to help you stay clear of fraudulent arrangements that could lead to significant financial risk to your business.

HMRC is aware that businesses are being approached by organisations offering models which falsely claim to be able to reduce employment costs through ‘tax credits’ offset from third party businesses they have acquired.

The organisations offering these models may call themselves, but not exclusively, payroll providers, intermediaries, umbrella solutions or back-office providers.

These organisations falsely claim that they can acquire businesses that have tax credits on file with HMRC, which may include businesses in pre-administration.

They claim to use the tax credits to offset employment taxes, such as PAYE and National Insurance due to HMRC, by operating the payroll and, as a result, can reduce the amount you need to pay.

Often in these arrangements none of the taxes due to HMRC are being paid. They do this by simply not paying the taxes over to HMRC or creating false documents to give the impression that the appropriate returns are made to HMRC and the taxes paid over.

To find out more about how these models are marketed, why they should not be used and what you should do to protect yourself, read our tax fraud warning for employment agencies and employers brief.

If you think you may already be using these types of models, HMRC offers a range of ways to notify us. Visit how to make a disclosure to HMRC for more information.

You can also report tax fraud and tax avoidance arrangements, schemes, and the person offering them to HMRC by using our online form to report tax fraud.

A separate tax fraud warning article has been issued on Bills of Exchange. Further information on this is available in the general information and customer support section of this Employer Bulletin.

Electronic payment deadline falls on a weekend

In August 2026 the electronic payment deadline falls on Saturday 22 August 2026. To make sure your payment for this month reaches us on time, you need to have funds cleared into HMRC’s account by 20 August 2026, unless you are able to arrange a Faster Payment.

It is your responsibility to make sure your payments are made on time and, if your payment is late, you may be charged a penalty.

Check your bank or building society’s single transaction daily value limits and cut-off times well in advance of making your payment. Make sure you know when to initiate your payment, so it reaches HMRC on time.

Further information on how to pay employers’ PAYE is available.

Make your PAYE Settlement Agreement (PSA) payment

A PAYE Settlement Agreement (PSA) allows you to make one annual payment to cover all the tax and National Insurance due on small or irregular taxable expenses or benefits for your employees.

Any electronic payments for a PSA for the tax year ended 5 April 2026 must clear into HMRC’s account by 22 October 2026. If your payment is received late you may have to pay interest and a late payment penalty.

To pay, you will need to use the PSA reference number, for example, XA123456789012 from the payslip we sent to you. If you do not have this, contact the employer helpline for advice.

Do not use your PAYE Accounts Office reference, for example 123PA12345678, to make your PSA payment. Payments received with your PAYE Accounts Office reference are allocated to your normal PAYE account and you will continue to receive reminders for the PSA even though you have paid.

P11D and P11D(b) for tax year 2025 to 2026

P11D and P11D(b) filing and payment deadlines

The deadline for informing us online about any Class 1A National Insurance contributions that you owe for the tax year ending 5 April 2026 was on 6 July 2026. If you have still not done this, you need to submit a P11D(b) online without delay to avoid any further penalties which may be issued. You also need to send P11D forms online for any employees, unless you registered before 6 April 2025 to tax their expenses and benefits through the payroll.

Any Class 1A National Insurance you owe must have been paid by 22 July 2026.

There are a number of live webinars available covering submitting your P11D and P11D(b). 

How to submit P11D and P11D(b) online

You can use the following quick and easy online methods:

• commercial payroll software

• HMRC’s PAYE Online service

You must submit all your P11D and P11D(b) together in one online submission.

What to file

If you provided any benefits and or non-exempt expenses to your employees, you need to file a P11D(b). Include the total benefits liable to Class 1A National Insurance contributions, even if you taxed some or all of them through your employees’ pay.

You need to submit a P11D for each employee in receipt of benefits and or non-exempt expenses unless you registered with us before 6 April 2025 to tax them through your payroll. If you did payroll your employees’ expenses and benefits it is important that you do not complete P11D’s, only a P11D(b) is required.

Nothing to declare

You only need to make a declaration if HMRC has sent you a notice to file a P11D(b) or a reminder to file a P11D(b) letter and you have nothing to declare. You can declare a no return of Class 1A National Insurance contributions.

For common mistakes when completing a P11D or P11D(b) refer to February 2026 Employer Bulletin.

Company Car tax Calculator 

The new version of the Company Car tax Calculator is available. For any car changes that an employee has within the tax year, a P46 car form must be submitted.

Guidelines for Compliance (GfC) — Help with short-term business visitors — GfC19

HMRC has recently published new Guidelines for Compliance (GfC) — Help with short-term business visitors. Short-term business visitors (STBVs) are individuals who normally work overseas but come to the UK for short periods to carry out employment duties.

These guidelines are primarily for UK employers with overseas employees working in the UK on a short-term basis. However, they will also be useful to overseas employees, professional advisers and representative bodies supporting customers in this area.

They provide practical support by:

• explaining the Income Tax, National Insurance contributions  and PAYE treatment for STBVs

• highlighting common errors and areas of risk identified by HMRC

• helping customers get their tax right first time

• advising what records and evidence should be retained

• explaining what to do if a mistake is made

GfC products are part of HMRC’s ongoing commitment to publishing practical support for customers. These products complement existing HMRC guidance by clarifying HMRC’s view in complex, widely misunderstood or novel areas of the tax rules.

More information on GfC, including other publications, can be found on the Guidelines for Compliance collection page.

Phased roll-out for mandatory payrolling benefits in kind (BIKS) — actions for you to take now

Employers should be getting ready for reporting benefits in kind (BIKS) in real time, as outlined in the mandatory payrolling of benefits in kind and expenses — interim guidance and legislation.

We are encouraging you to get started now if you have not already done so.

From 6 April 2027 to 5 April 2028, mandatory payrolling will be introduced in phases. Phase 1 will apply only to:

• company cars

• car fuel

• vans

• van fuel

• medical benefits

Mandatory payrolling for most other benefits will be introduced from April 2028. Phasing delivery in this way will support employers and payroll providers to prepare and adapt in a manageable way.

Communicating to employees

It is important that you make employees aware of these changes. Early communication is key to enabling them to understand how this might affect their tax codes and take-home pay.

You should explain how:

• employees who currently pay tax in arrears on BiKs will not do so from April 2027 onwards for BiKs to be payrolled in phase 1 — many employees may not realise this is how they are paying tax on BiKs, and that next year they will pay tax on their BiKs for cars, vans, fuel for both and medical benefits in the year they receive them

• they may currently have a deduction in their tax code so they pay tax on an estimated benefit — this will no longer be the case from April 2027

• tax on phase 1 BiKs must be paid in real time in the year they are received

Where your employee is also paying back an underpayment of tax on a benefit provided in a previous year, it will be helpful for you to explain why it might feel from April 2027 that they are ‘paying tax twice’ on the BiKs — however that is not the case in reality.

You should act now, well ahead of the changes and will need to:

• explain how your employees will be paying tax in real time on the cars, vans, fuel for both and medical BiKs they receive for the 2027 to 2028 tax year, while they may also be catching up with payments for any BiKs from the previous tax year once mandatory payrolling applies

• use clear and accurate wording or terminology, in any communications to explain this very important distinction — avoid terminology such as ‘double taxation’ that could imply additional tax is being collected which is not correct

• be prepared for instances where your employee is paying tax in the current year as well as underpayments for previous years which may be related to BiKs

• advise your employee to contact HMRC to discuss options based on their circumstances if this overlapping taxation causes hardship

Your preparations for mandatory payrolling BiKs for phase 1

It is now time for you to take steps getting ready for mandatory payrolling in phase 1, you should:

• make a list of all the BiKs you offer and would ordinarily report to HMRC on a P11D form

• make sure your payroll software can handle real time reporting of BiKs for phase 1 and complies with HMRC’s requirements — this may not be ready now, but will need to be in place by April 2027

• plan out how you will manage employees who leave or join during the tax year, or benefits that change in value

• read more information on mandatory payrolling of benefits in kind and expenses — interim guidance and legislation, including sections on communicating to employees and preparing for the transition to real time reporting of BiKs 

• understand the process for dealing with any underpayment or overpayment so you can support employees

Voluntary payrolling

Employers will be able to register for voluntary payrolling from November 2026 for all other BiKs that have not been mandated to be payrolled from April 2027, including loans and accommodation.

Mandatory payrolling of benefits in kind and expenses — interim guidance and legislation is being updated to reflect phasing and feedback. HMRC expects the final guidance for phase 1 to be published in autumn 2026.

We appreciate the efforts of employers who are already preparing for the changes.

Tax updates and changes to guidance

Mileage payment changes for tax year 2026 to 2027

Approved Mileage Allowance Payments (MAPs) have been updated for the 2026 to 2027 tax year. Rates have:

• increased to 55p per mile for the first 10,000 miles

• remained at 25p per mile after 10,000 miles

The National Insurance contributions disregard for Relevant Motoring Expenses (RME) has also increased to 55p per mile.

These changes are backdated to 6 April 2026.

If you reimburse your employees at or below the approved MAP rate, you may want to increase the amount you reimburse your employees for business mileage, in line with the new approved MAP rates.

If you paid your employees mileage payments or RME above the old rates, Income Tax and or Class 1 National Insurance contributions may have been deducted which may no longer be due. You may need to correct payroll for previous months in the 2026 to 2027 tax year, so that overpaid tax and both employers and employees’ Class 1 National Insurance contributions can be refunded. To update payroll, you should follow the PAYE guidance as if you had made an error using fix problems with running payroll.

If you do not reimburse mileage, or if you reimburse at less than the new approved MAPs rate, your employees can follow advice on how to claim tax relief for their job expenses.

Proposals to tackle lower value tax debts in government consultation

As part of the Tax Update package announced on 23 June 2026, the government launched a consultation on proposals to tackle lower value tax debts from customers who can afford to pay but persistently choose not to engage with HMRC. Each year, more than 750,000 such debts, worth over £2 billion, remain uncollected after 9 months and more than 10 contact attempts. The proposals would extend an existing HMRC enforcement power, enabling HMRC to recover these debts through affordable monthly deductions from a customer’s UK bank or building society account.

The consultation outlines a proposed process and stringent safeguards, and HMRC would welcome industry insight and feedback that will help to inform the policy’s development.

The consultation on tackling lower value tax debts closes on 28 August 2026. Details on how to respond are set out in the consultation document.

Aligning National Insurance contributions recovery time limits with Income Tax — consultation launch

HMRC is consulting on proposals to align the time limits and processes for recovering National Insurance contributions with those that apply to Income Tax.

The consultation may be relevant to employers and agents who deal with PAYE Income Tax and National Insurance contributions liabilities.

Currently, National Insurance contributions and Income Tax operate under different recovery frameworks.

For Income Tax, behavioural time limits apply to the assessment of liability, with no fixed limit on recovery once an assessment has been made.

For National Insurance contributions, there are no equivalent assessment time limits. Recovery is generally limited to 6 years by the Limitation Act 1980, unless action is taken to protect the debt either through the courts or by HMRC entering into a standstill agreement with the customer.

This can create complexity where PAYE Income Tax and National Insurance contributions liabilities arise from the same income but are handled through different processes.

The consultation seeks views on proposals to:

• remove National Insurance contributions from the scope of the Limitation Act 1980

• align the time limits for recovering National Insurance contributions debts with those for tax

• align the time limits for National Insurance contributions repayments with those for tax

This would bring National Insurance contributions more in line with tax administration and is intended to make the system simpler and more predictable for employers, agents, individuals and HMRC.

The government would like to hear views on whether the proposals would be workable in practice, whether there are any disadvantages or practical constraints, and whether there are further improvements that could be made to the National Insurance contributions recovery process.

Aligning the time limits for recover of National Insurance contributions with Income Tax provides further details on the consultation, including how to respond. This consultation closes at 11:59pm on 12 October 2026.

Voluntary National Insurance contributions abroad

At Budget 2025 the government announced there would be changes to voluntary National Insurance contributions abroad.

As of 6 April 2026, for tax years 2026 to 2027 onwards, the option to pay voluntary Class 2 National Insurance contributions for periods abroad has been removed and new Class 3 National Insurance contributions applications for periods abroad will require 10 years’ continuous UK residency or paid at least 10 years of National Insurance contributions. If you have workers abroad, inform them of the changes that came into effect from April 2026.

Customers affected by the change will receive a letter in July or August 2026 outlining the next steps. If you pay voluntary Class 2 National Insurance contributions on behalf of your employees, you may also be contacted by letter during the same period.

The changes do not affect the ability of anyone to purchase voluntary National Insurance contributions for tax years prior to 2026 to 2027.

HMRC encourages employers to review the latest voluntary National Insurance guidance.

The voluntary National Insurance contributions for periods abroad from 6 April 2026 tax impact and information note provides further information.

UK — India Double Contributions Convention

In the February 2026 Employer Bulletin, HMRC informed you of a new National Insurance Double Contributions Convention (DCC) between the UK and India.

The DCC formally entered into force on 15 July 2026, and impacts employees, and their employers, moving between the UK and India. The DCC also contains specific rules for government employees, mariners and aircrew.

The UK and India have agreed to extend the detached worker provision in the DCC from three to five years.

This means that employees from one country who are sent to work temporarily in the other country, for up to five years, will continue to pay contributions in their home country only. For UK employees sent by their UK employers to work temporarily in India for up to five years, they will continue to pay UK National Insurance contributions during their period of work in India. They will not have to pay contributions into the Indian scheme.

HMRC has also now published technical guidance in the National Insurance manual at NIM33250, giving our view of how the provisions of the DCC work, which employers should consider ahead of any employee movement between the UK and India.

Employees who will remain liable to pay UK National Insurance contributions whilst working in India, or their employers, can now apply to HMRC for certificates of coverage using the online CA9107 form. These certificates confirm that an employee will continue to pay National Insurance contributions in the UK and will not be liable to pay social security contributions in India.

Low earner’s pension payment — what employers need to know

In the June Employer Bulletin HMRC advised that from August 2026, HMRC would begin contacting around 1 million eligible individuals directly about the low earner’s pension payment, previously referred to as the low earner’s anomaly.

There has been a small delay to the delivery of the scheme. Payments for contributions made in 2024 to 2025 will now begin in the coming months, with HMRC taking a phased approach and gradually expanding the rollout over the remainder of the year and into early 2027. HMRC will keep you updated on progress in future bulletins.

What this means for employers

No action is required for employers or payroll teams. There is no requirement to apply, assess eligibility, amend payroll records, or contact HMRC on behalf of employees. HMRC will contact eligible individuals directly. If employees ask you about this payment, you can reassure them that HMRC will be in touch with those who qualify.

General information and customer support

Employment related securities — penalties for missed end of year return deadline for employee share schemes

Gifts and awards of shares in companies, often referred to as employment related securities (ERS), are commonly used by employers to reward, retain or incentivise employees.

If you operate an ERS scheme, you are required to submit an end of year ERS return, including nil returns, for every scheme registered on the ERS online service against your PAYE scheme.

If your scheme has closed, you must enter the final event date online and submit any annual returns for the tax year in which the final event date falls.

For the 2025 to 2026 tax year, the deadline for submitting an end of year ERS return was on or before 6 July 2026.

If you missed the deadline, a £100 late filing penalty will have now been issued to the address associated with the PAYE account.

Additional automatic penalties of £300 will be charged if the return is not submitted three months after the original deadline of 6 July 2026. A further £300 will then be charged if it is still outstanding six months after this date.

The charge description for penalties relating to employee share schemes will be referred to as Employment Related Securities.

If you appeal against an ERS late filing penalty you must ensure you have submitted your outstanding end of year returns. An end of year return must be submitted to prevent further penalties.

More information on how to deal with an employment related securities penalty is available.

Accessibility improvements to ERS end of year templates from April 2027 

To make sure that HMRC documentation is compliant with accessibility regulations, the ERS end of year return templates, guidance and technical notes are going through a review process with the aim to make them consistent, clear and more user friendly.

HMRC plans to publish new versions at the beginning of November 2026.  This will give you 5 months’ notice to make any changes to non-standard HMRC templates used to submit ERS end of year returns.

Further details, including timings of the changes, are available in Bulletin 67.

Help improve GOV.UK guidance for employers

HMRC are looking for people involved in running employee payrolls to help shape GOV.UK guidance for employers.

If you would like to take part in user research, email cxduserresearch@hmrc.gov.uk with your name, email address and role title.

You may be invited to take part in a research session online using Microsoft Teams and we offer a voucher as a thank you for taking part.

Any information you give will be:

• anonymised

• confidential

• used for research purposes only

• held securely at all times in line with data protection law

By sharing your experience, you will help us create GOV.UK guidance for everyone.

Look again to spot bad tax advice

HMRC’s don’t get caught out campaign is successfully helping contractors working through umbrella companies to spot bad tax advice and watch out for tax avoidance schemes.

You can help us to protect contractors from tax avoidance by sharing HMRC’s campaign resources in your newsletters, on your websites and across your socials.

Contractors can use our guidance, interactive tools and personal stories to get help to identify, leave or report a tax avoidance scheme. A short YouTube video on umbrella companies and what the risks are to contractors explains how they can check their pay arrangement to make sure they are not in a tax avoidance scheme.   

Whether your contractor already works through an umbrella company or is thinking of signing up, they should check the named tax schemes, promoters, enablers and suppliers report. It is not a complete list of all tax avoidance schemes and if a scheme is not shown, this does not mean that it works. HMRC never approves tax avoidance schemes.

We are here to help customers avoid mistakes, get things right first time and pay the right amount of tax, so they don’t get caught out by tax avoidance.

Help your parent or carer employees receive the Child Benefit payments they are entitled to 

Parents and carers whose children remain in full-time education can continue to receive Child Benefit through the HMRC app or online. This includes those who:

• will study at home due to illness or disability 

• start approved training  

If the child is starting the second year of a full-time non-advanced education course, they do not need to contact us.  

Parents and carers can update their claim in minutes, whether they are at home or on the go. Extending Child Benefit online means parents or carers do not need to call HMRC.  

Anyone who wants to continue receiving Child Benefit needs to act before 31 August, or their payments will stop.  

Any parent or carer who extends their Child Benefit, and they or their partner has an income of more than £60,000, will still be liable to pay the High Income Child Benefit Charge, which can now be paid through their PAYE tax code.  

Share this message with your employees to encourage them to extend their Child Benefit online. 

Changes to the multi-year tax refund process  

HMRC is changing how repayments are issued for the majority of employees who make a multi-year P800 tax refund request.   

Employees who make a claim for a multi‑year tax refund will now need to request their repayment through HMRC’s digital services, rather than automatically receiving a cheque.   

This change aligns multi‑year claims with the wider P800 repayment process introduced in May 2024, where customers must take action to receive any money they are owed.   

Help your employees understand that they now need to request their repayment, rather than waiting for a cheque to be issued.    

What this means for your employees   

The are no changes to the process for employees requesting multi-year claims.  

Once their claim has been processed, they will receive a P800 Tax Calculation letter and be asked to request their repayment.  

Repayments are no longer issued automatically by cheque. 

The quickest way to receive payment is through HMRC’s digital services. 

We may contact employees during the process to explain how to claim their repayment.   

How employees receive their repayment   

Once a claim has been agreed, employees can request their repayment through the HMRC app or their personal tax account.  

Employees do not need to be fully set up for HMRC online services to request a tax refund.  

They can request their refund through the tax overpayments and underpayments page using the unique reference number in their P800 letter and their National Insurance number, rather than signing in with Government Gateway credentials. 

Repayments requested digitally are normally made by bank transfer within one week.    

Those who prefer a cheque or are digitally excluded can still choose to request a cheque, however this will take longer to arrive. Further information and options for receiving payment are available by contacting Income Tax enquiries.

Report Fraud advice on ransomware attacks 

Ransomware remains one of the biggest threats to businesses and organisations across the UK. Report Fraud received 323 reports of ransomware attacks in 2025 to2026, with over half of these coming from small and medium enterprises. 

Ransomware is a type of malware which prevents you from accessing your device and the data stored on it, usually by encrypting your files. A criminal will then demand a ransom in exchange for unlocking the files or data held.

To help protect your business you should:  

• make regular backups of your most important files 

• use tools and techniques to prevent malware being delivered, such as mail filtering, to only allow certain file types, and blocking malicious websites

• take steps to prevent malware running on devices, such as centrally managing devices and considering antivirus and anti-malware products

• prepare for a potential incident by identifying your critical assets and determining how you would respond to a ransom demand 

If you are a small or medium-sized business and experience a ransomware attack, Report Fraud advises you to:

• report it to the police immediately by calling Report Fraud on 0300 123 2040 if you are in England, Wales or Northern Ireland

• report it to the police by calling 101 if your organisation is based in Scotland, the Isle of Man or the Channel Islands

• not pay the ransom, as the National Cyber Security Centre and UK law enforcement do not recommend paying ransom demands and there is no guarantee that access can be regained to data held or that devices will no longer be infected 

If you are a large organisation experiencing a ransomware attack, use this Cyber Incident Signposting Service for guidance on where to report a cyber incident.

For more information on protecting your business against ransomware see the guidance from the National Cyber Security Centre website.  

Employment Rights Act 2025 — actions to take now 

As a part of the ongoing implementation of the Employment Rights Act 2025, employers should start getting ready now for changes that are happening from October 2026 onwards.  

Further  information on new employment rights — guidance for businesses and workers is available on business.gov.uk.  

Important changes from October 2026  

Workplace sexual harassment protections  

The following changes will come into force from October 2026:   

• employers will be expected to take all reasonable steps to prevent sexual harassment of their employees  

• employers will have an obligation not to permit the harassment of their employees by third parties  

For more information, see the article workplace sexual harassment protections — upcoming changes’ in the June edition of the Employer Bulletin.  

Reforms to trade union law  

Key changes for employers include:  

• a new legal right for independent trade unions to access workplaces and engage with workers  

• a new duty on employers to tell workers about their right to join a union  

For more information, read  ‘Trade Union right of access — new rules from October 2026’  in this bulletin.

Prepare for unfair dismissal reforms  

Unfair dismissal changes will come into effect from 1 January 2027, when the qualifying period is reduced from two years to six months. Employees who have completed 6 months’ service by that date will gain unfair dismissal protection immediately and will have the right to make a claim. If an employee is recruited after July 2026, they will gain protection six months after their start date. Given the scale of this change, employers should be preparing now.  

Acas has published new guidance on probation periods as part of Acas’s advice on hiring someone. This guidance will help businesses understand how to prepare a fair process, set clear expectations, and support people in their new roles.    

Plan to Make Work Pay and Employment Rights Act timeline update provides a full list of the reforms and when they will take effect.   

Engage with us on consultations     

The Department for Business and Trade are currently seeking views on a number of employment law reforms, including reforms to zero-hours and similar contracts.  

All current consultations, plus details of closed consultations and published outcomes, can be found at Make Work Pay.  

Trade Union right of access — new rules from October 2026 

The Employment Rights Act 2025 introduces a new legal right for independent trade unions to access workplaces and engage with workers, either in person or virtually.    

Employers and unions will be able to agree access arrangements under a statutory framework. If they cannot reach agreement, either party will be able to apply to the Central Arbitration Committee (CAC) for a decision.   

The key changes coming into force in October 2026 are:  

• independent trade unions will be able to formally submit a request to employers to access their workplaces  

• access can be physical, digital, or a combination of both  

• if agreement cannot be reached, either party will be able to apply to the CAC  

• employers who employ fewer than 21 workers across all of their workplaces will be exempt from these provisions   

• the CAC will be responsible for overseeing and enforcing statutory access agreements and can issue fines for breaches of an agreement  

A statutory code of practice will provide guidance and further information on how access should operate in practice.  

Trade union right of access — October 2026 implementation   

On 6 July 2026, the government published its consultation outcome and Impact Assessment and laid the revised draft code of practice on trade union right of access in Parliament.  

The change is expected to come into force in October 2026, subject to parliamentary approval.  

Further free guidance on new employment rights — guidance for businesses and workers is available on business.gov.uk.

Getting conflict competent 

Healthy workplace relations are not a soft aspiration, they are a business essential. When people trust one another, feel able to raise concerns early, and are taught the skills to resolve disagreements constructively, organisations perform better.  

Workplace conflict which is avoided, allowed to harden, or formalised too quickly impacts wellbeing, retention, productivity and profit.   

The good news is that employers can act by:  

• investing in the confidence and capability of your line managers  

• creating a culture where early, informal resolution is supported  

• encouraging leadership, employees and unions to work in partnership  

• making mediation part of the process and formal grievances or tribunal claims a last resort  

Acas is the independent public body providing free, impartial advice and practical support to both employers and workers. They can help you prevent problems with free advice and guidance and prepare for changes in the Employment Rights Act.   

The Acas website has more information including courses and other learning and development offers.  

Tax fraud warning — attempts to use Bills of Exchange to pay HMRC 

HMRC has published a tax fraud warning to raise awareness of a new fraudulent payment model using Bills of Exchange as a way to pay a tax liability.  

A Bill of Exchange is defined in the Bills of Exchange Act 1882. It is a note from one person to another, requiring that person to pay a certain sum of money to them or to a third party. However, it is up to the recipient to decide whether or not to accept the Bill of Exchange as a form of payment. Even when the bill has been drawn up according to the legislation, the recipient has no legal obligation to accept it. HMRC does not accept Bills of Exchange against a tax liability.  

Further information on Bills of Exchange is available on the legislation.gov website. 

It is currently being marketed to employers, recruitment and temporary labour agencies, however any business could be approached as it is not tax or trade sector specific.  

Organised crime groups are particularly active in the temporary employment agency and recruitment sector, but HMRC wants to raise awareness for all businesses.  

Promoters claim that a Bill of Exchange can be used to wipe out HMRC debt. They offer to manage the process for customers, particularly payroll providers, and act on the customer’s behalf drawing up any affidavits and engaging with HMRC.  

In addition to Bills of Exchange, other forms of wording in promotional material may include reference to money orders, public trusts, merchant law or negotiable instruments.  

Promoters may also claim that using Bills of Exchange can avoid the new umbrella company legislation which was introduced from April 2026. This is not true. Details of the changes to Income Tax rules to tackle non-compliance within umbrella companies is available. 

In some cases, promoters may claim that the use of these arrangements are accepted or unchallenged by HMRC, or that the arrangements have been approved by Kings Counsel. This is not the case.  

Using these arrangements could significantly cost your business, not only through paying the promoter to use or facilitate their payment model, but also additional interest, penalties or fees that may be charged by HMRC where a debt is not fully paid on time.  

HMRC is here to help you stay clear of fraudulent arrangements that could significantly cost your business.  

If you think you may already be using this payment arrangement you should contact HMRC as soon as possible. HMRC offers a range of ways to notify us how to make a disclosure to HMRC. HMRC can help you get back on track.  

HMRC clearly sets out how to pay different taxes and duties, including what to do if you have difficulties paying and what will happen if you do not pay your tax bill. 

If you are concerned about an individual or organisation offering you a tax saving arrangement, avoidance scheme or fraud arrangement, you can report it to HMRC using the report tax fraud or avoidance online form.  

You can submit this form anonymously and do not have to give your name, address or your email. If you cannot use the online form, you can phone HMRC to report tax fraud or avoidance on 0800 788 887. 

HMRC is committed to tackling fraud and will continue to use its full range of criminal and civil powers to stop fraud and take action against those who break the rules.  

A separate tax fraud warning article has been issued on tax credits reducing employers’ liabilities. Further information on this is available in the PAYE section of this Employer Bulletin. 

HTML format of employer bulletin  

Since September 2020, material published on GOV.UK or other public sector websites must meet accessibility standards. This is so they can be used by as many people as possible, including those with: 

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Getting more information and sending feedback 

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Send your feedback about this employer bulletin or articles you may wish to read, by email to GRP128613644@hmrc.onmicrosoft.com.