Payslip Fraud 2026/27: Check Your Tax Actually Reached HMRC

Your payslip is two promises, not one. The first is the money that lands in your account. The second is that the tax, National Insurance, student loan and pension figures printed above it were actually handed over to the people whose names are next to them.

The second promise is the one nobody checks. HMRC published new guidance on 25 August 2026 on exactly this failure, and named it: payslip fraud, a sub-type of what HMRC calls organised labour fraud. It happens when a worker is given “a payslip showing tax deductions that have not been paid to HMRC”, a CIS deduction statement in the same position, incorrect information about pay or deductions, or no payslip at all. HMRC’s own warning is blunt: “Fraudulent payslips may look genuine, even if the tax deducted has not been paid.”

Why this bites years later

Nothing goes wrong on payday. The net pay arrives, the payslip looks normal, and the gap only opens up when you ask the state for something that the deductions were supposed to have bought. HMRC lists the consequences of tax, National Insurance or CIS deductions not reaching them on your behalf:

• you could miss out on benefits such as Universal Credit
• you could have problems claiming Statutory Sick Pay
• you could have problems claiming maternity or paternity pay
• you could receive less State Pension than expected
• you could face unexpected tax bills in the future
• you could be unable to claim tax repayments you are entitled to

That list is the reason this is worth five minutes a month. A missing qualifying year on your National Insurance record is cheap to fix at the time and expensive to fix a decade later.

What changed on 6 April 2026

If you are paid through an umbrella company, the liability map was redrawn this tax year, and it was redrawn specifically because of this problem.

From 6 April 2026, for money paid to workers on or after that date, the agency that holds the contract with the end client is responsible for making sure PAYE is operated correctly when an umbrella company employs their workers. Where there is no agency in the chain, that responsibility sits with the end client. HMRC states the consequence plainly: “We can recover any underpayment of PAYE from them.” The rules apply to new and existing labour supply chains alike.

Two things people get wrong about this change:

1. The umbrella company is still your employer. It still has the legal responsibilities of an employer for employment rights, and it is still responsible for working out PAYE for its employees correctly and paying HMRC on time. The new rule adds a party HMRC can pursue; it does not remove one.
2. It does not cover everyone in a supply chain. The rules do not apply where workers are employed through their own personal service company and certain conditions are met (see off-payroll working / IR35), are deemed to be employed through a managed service company, are salaried members of an LLP, or are treated as employed by an agency under the agency legislation. HMRC adds a caveat worth keeping in mind: “there may be some circumstances when the rules will apply in these cases”, aimed at arrangements that are only purporting to be one of the excluded structures.

For you as a worker, the practical effect is that there is now more than one organisation with a direct financial reason to want your PAYE to be right. That is only useful if somebody notices the gap, which brings us back to the checks.

The five-minute check

HMRC’s guidance points at four records. Compare each against the payslips you have been given:

What to check	Where	What a problem looks like
Tax code, pay to date, tax to date	Personal Tax Account or the HMRC app	HMRC’s pay-to-date is lower than your payslips add up to, or the tax code differs from the one on your payslip
National Insurance record	Your NI record on GOV.UK	A completed year does not qualify, or shows less than you were deducted. The record only runs up to the start of the current tax year, so this year shows nothing yet
Student loan repayments	Your student loan repayment account	Deductions on payslips that never reach the balance
Pension contributions	Annual statement from the pension provider	Statement total lower than the deductions on your payslips

HMRC’s separate guidance, Check if the tax on your payslip is correct, sets out the mechanical version: compare the tax code on the payslip with the one HMRC holds using the check your Income Tax service or the HMRC app, work out what your code means, then use the estimate your tax for the current year tool with your gross pay and code and compare the answer with the tax actually deducted.

Also make sure of the basics on every payslip: that you receive one for every pay period, that your name and personal details are right, that the employer or payroll provider details are right, that your tax code is correct, that the tax and National Insurance deductions look reasonable, and that any pension deductions are accurate.

Our payslip explained walkthrough covers what each line on a UK payslip means, and the Personal Tax Account guide covers getting signed in if you have never used it.

HMRC’s warning signs, in full

This is HMRC’s own list of the signs of organised labour fraud. Any one of them is a reason to look harder:

• your payslips or CIS deduction statements regularly change format or show different employer names
• you are frequently moved between payroll companies or contractors
• your payslip includes vague deductions, like “admin adjustments”
• your take-home (net) pay does not match the hours you worked
• you are promised your full pay without tax being deducted
• you receive no payslips
• your payslips appear incorrect or inconsistent
• you can no longer access your payslip portal
• you are asked to set up your own limited company or personal service company
• you are suddenly moved to a different umbrella, payroll, or employment company without a clear reason
• you have problems accessing company benefits, like pension or voucher schemes
• you are not given a Key Information Document each time your employer changes

Losing access to a payslip portal deserves a special mention, because it is the one that destroys your evidence. Download or photograph every payslip as you receive it. A portal you cannot log into is a portal that cannot prove what you were told.

”Full pay, no tax deducted” is a trap, not a perk

It is the fifth item on that list, and it is the one that most often gets sold to a worker as a favour. It is worth understanding where the money lands if it goes wrong.

Regulation 72 of the Income Tax (Pay As You Earn) Regulations 2003 deals with “recovery from employee of tax not deducted by employer”. Where the amount that should have been deducted exceeds the amount actually deducted, HMRC may direct that the employer is not liable for the excess, if one of two conditions is met:

• Condition A: the employer satisfies HMRC that it took reasonable care to comply with the regulations, and that the failure to deduct was due to an error made in good faith.
• Condition B: HMRC is of the opinion that the employee received the payments knowing that the employer wilfully failed to deduct the tax that should have been deducted.

Where a direction is made, the tax is the worker’s to pay. Under condition B, it also carries interest as though it were unpaid tax due from an employer. An arrangement that pays you “gross” because tax is “handled elsewhere” is an arrangement that can leave you holding the bill with interest running on it.

The distinction matters, so be clear about which side of it you are on. Regulation 72 is about tax that was never deducted. If tax genuinely was deducted from your pay and the employer then failed to hand it over, the ordinary position is that you are still credited with it: regulation 185(5) of the same regulations adds the tax deducted to your total net tax deducted for the purposes of your Self Assessment, and regulation 72(6) is precisely the provision that takes that credit away once a direction has been made. So the typical payslip-fraud victim - deductions taken, deductions not paid over

• is not the person regulation 72 is aimed at. The person who agreed to be paid gross may well be.

Agency and umbrella workers: the Key Information Document

If you find work through an employment business, you have a document that exists precisely to make deduction chains visible. Under regulation 13A of the Conduct of Employment Agencies and Employment Businesses Regulations 2003, in force since 6 April 2020, a new agency work-seeker must be given a Key Information Document before agreeing terms. Where you are paid through an umbrella company it must show, among other things:

• the name of the intermediary or umbrella company, and who your employer is
• who is responsible for paying you, and how often
• the expected or minimum assignment rate paid to the intermediary
• every deduction from the assignment rate, lawful and additional, with the amounts or the calculation
• the expected or minimum rate of pay to you, and every deduction from your pay
• any fees for goods or services
• holiday entitlement and holiday pay
• a representative example pay statement showing how those deductions hit your take-home pay
• contact details for the Fair Work Agency, for complaints

An updated document is required within 5 business days of a significant change. Read it against your first payslip. The representative example is the single most useful page an agency will ever give you, because it is the employer’s own written statement of what your payslip should look like.

Our umbrella company selection guide covers what to ask before you sign, and umbrella vs limited company covers the structural choice.

Construction and CIS

HMRC singles out construction, for a structural reason: large projects “often have multiple tiers of contractors, subcontractors, labour agencies, payroll providers, and self-employed workers”, which makes it harder to see who is responsible for paying Income Tax, National Insurance and CIS deductions. Long chains hide the gap.

If you are self-employed and paid under CIS, check your deduction statements, not just your invoices. Deductions that were never paid over affect any CIS repayment or offset you expect. HMRC’s instruction if you have concerns is specific: send your Self Assessment return as usual, and include the full amount from your invoices as income, with any CIS deductions in the CIS deductions field. HMRC may ask you to provide evidence of those deductions, so keep the statements.

Our CIS deep dive covers the 20% and 30% deduction rates and the repayment mechanics, and the CIS calculator works out the deduction on a gross invoice.

Before you take the work

HMRC’s prevention list is short and worth asking out loud, before the first timesheet rather than after the third payslip:

• who your employer is
• who will pay you
• whether you are employed directly, or through an agency or umbrella company
• what deductions will be taken from your pay
• how and when you will receive payslips

If the answer to “who is my employer” takes more than one sentence, that is information in itself.

Reporting it

HMRC asks you to report suspected payslip fraud if you do not receive payslips, you receive fake or false payslips, the deductions shown do not match HMRC’s records, or you believe tax, National Insurance or CIS deductions are not being paid correctly on your behalf. The route is the report tax fraud service on GOV.UK.

For the employment-rights side of an agency or umbrella arrangement - no Key Information Document, unexplained deductions from the assignment rate, holiday pay that never appears - the Fair Work Agency replaced the Employment Agency Standards Inspectorate as the enforcement body.

Reporting is not only about your own position. HMRC’s framing is that these arrangements are how labour supply chains avoid tax at scale, and the workers inside them are the evidence.

Related

• Payslip explained - every line on a UK payslip
• How to check your tax code - the code is the first thing to compare
• Personal Tax Account guide - where HMRC’s version of your pay lives
• HMRC scams: how to spot and report - the other direction of fraud
• Choosing an umbrella company
• Umbrella vs limited company
• CIS deep dive
• IR35 explained