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HMRC internal manual

Compliance Operational Guidance

Supporting Guidance: employer compliance: guidance by subject: liaison: hidden economy - employers team (formerly ECIT)

The Hidden Economy (Employers) Team is in Local Compliance and is responsible for:

  • employers who should be registered but are not, and
  • employers who may facilitate ghosts and moonlighters.

The Management team within LC should make sure that:

  • there are clear lines of communication between Hidden Economy (Employers) and other staff
  • the duties of Hidden Economy (Employers) Team and other EC staff are clear.

SME Employers

Where the SME caseworker discovers evidence or has a strong suspicion that the employer has colluded with the employee/employees so that the employee/employees gain additional benefits, for example, for tax credits, by

  • reducing liability to PAYE/NIC by paying or providing off record wages/benefits, or
  • reducing business taxation liabilities

the caseworker must

  • refer the case to the appropriate HET team.

EU Large Employers

HE-E’s should not undertake any activity into any employer that falls within the EU Large Employer population.

If any compliance activity has been commenced and it is subsequently found to be an EU Large employer, immediate contact must be made with the:

  • local L&C EC Team manager
  • for arrangements to be made to transfer the case to the appropriate team in L&C or Individuals.

If any SIP’s are received from RIS that relate to an EU Large Employer you should:

  • in Cases where CRM is appointed

    • pass the SIP to the CRM
  • in Non-CRM cases

    • Return the SIP to RIS to re-distribute to the relevant EC EU Large Team.

There will be occasions when the teams within L&C and Individuals that deal with EU Large cases will need to utilise the experience that exists within HE-E’s. In such cases contact will be made with the local HE-E manager to arrange joint working.