ContractorCare Ltd has been named by HMRC as a tax avoidance promoter, along with PAYEme Ltd, and Gateway Outsource Solutions Ltd. HMRC has urged people to withdraw from the schemes and contact HMRC as soon as possible to address income paid without paying tax liability.

ContractorCare scheme users sign a contract of employment along with a ‘master advance agreement’. The user is paid a salary equivalent to the national minimum wage (NMW) and an un-taxed payment called an advance, meaning scheme users retain up to 84% of the expected gross contract earnings. The promoter retains around 18% of the amount invoiced to the agency or end client.

The PAYEme scheme operates in a similar way with the majority of earnings untaxed as 78% is paid through a so-called 'master advance agreement' while the agency takes a 17% cut from fees paid by client companies. The Gateway scheme again pays a mix of national minimum wage rates for some of the work and the balance with an untaxed loan or advance.