Checks for contractors, recruitment agencies and end clients before using an umbrella company – accreditation, payslip and key information document, PAYE and holiday pay compliance, warning signs of tax avoidance schemes – reflecting the April 2026 rules making agencies liable for umbrella PAYE.
Freelancers & contractors
Umbrella Company Due Diligence Checklist
About this document
Many contractors are paid through umbrella companies, which employ them and run PAYE. Some non-compliant umbrellas use tax avoidance or “mini umbrella” fraud schemes, leaving workers with large tax bills. From 6 April 2026, the recruitment agency that supplies the worker (or the end client if there is no agency) is jointly and severally liable for unpaid PAYE and National Insurance of the umbrella. Everyone in the chain therefore needs to check umbrellas carefully.
The document is laid out in the sections below. Each one comes with a plain-English guidance note explaining what it does and what to change.
A complete, ready-to-use document with every section written, your details shown in [square brackets], and guidance notes explaining how to complete it.
Our templates are professionally structured starting points for UK businesses, not legal advice. For anything complex, unusual or high-value, have your final version checked by a solicitor.
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Freelancers & contractors
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Editable Microsoft Word files
Guidance notes in every document
Written for UK businesses
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