T2 Outsourcing Limited - HMRC named tax avoidance scheme

T2 Outsourcing Limited

  • Promotor of Scheme: T2 Outsourcing Limited (T2)
  • Address: Unit 5, Connect Business Village, Derby Road, Liverpool, L5 9PR
  • Publication Date: 7 July 2022
  • Scheme Reference Number (SRN) and date it was allocated: 28632053, 27 April 2022
  • HMRC’s Scheme Description: “The scheme user enters an employment contract with T2 who make composite payments to the scheme users for services provided by the user. The first element is a National Minimum Wage (NMW) salary that is subjected to tax and National Insurance Contributions (NICs), and a secondary element described as an “advance drawdown” which is not.”

T2 Outsourcing Limited – more details

The HMRC website states the scheme operates as follows:

  1. The scheme user enters an employment contract with T2, which states that T2 will pay the employee at a rate equivalent to the NMW (or Living Wage).
  2. Scheme users forward timesheets to T2, and T2 then invoices the recruitment agency or end client for the services provided by the scheme user.
  3. T2 retains between 18% and 22% of the gross contract value invoiced to the recruitment agency or end client as their fee.
  4. T2 then makes a single payment to the scheme user’s bank account which is the aggregate of:
    • salary for the hours worked in line with NMW hourly rate which is paid net of tax and NICs.
    • the remaining balance described as an advance drawdown’ which is notified by an ‘advance advice note’ to the user – this secondary element is made without being subjected to deductions of tax and NICs.

For more information, visit the following page on the government’s website: Current list of named tax avoidance schemes, promoters, enablers and suppliers.

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