Background
Misleading Advertising: Erudite Partners Ltd breaks the UK advertising rules for making misleading claims and omissions for the tax arrangements offered on the https://eruditepartners.co.uk website.
Together with HMRC, the CAP Compliance team has been taking market-wide action about the advertising of tax arrangements. As part of this work we published our joint Enforcement Notice - Advertising Tax Arrangement Schemes.
The Notice applies to websites which advertise a tax arrangement to UK individuals or businesses that has been challenged by HMRC. The tax arrangement advertised by Erudite Partners Ltd was challenged by HMRC and subsequently this issue was passed to the Compliance team.
Misleading Statements
The following references on the Erudite Partners Ltd website breach the Enforcement Notice because the arrangement has been challenged by HMRC:
- “Erudite Partners Ltd offer contractors the ideal payroll solution, without all the administrative hassle and responsibility”
- “Enjoy the freedom and flexibility of using an umbrella service and a convenient payroll option that you can rely on”
- “Experienced Team - We keep up to date with the very latest legislation”
- “We keep up to date with the latest in government legislation and can help you navigate the continuously evolving contractor landscape”
- “Involves far less administration and ensures that you remain compliant with IR35 legislation”
- “Erudite Partners’ operate a leading umbrella payroll service designed to give contractors flexibility with their assignments and stability in their payroll”
On the basis that the tax arrangement offered for umbrella payroll services on the https://eruditepartners.co.uk website has been challenged by HMRC, and contractors using the scheme may not be paying the correct tax and National Insurance contributions, we consider these statements are likely to mislead consumers.
Omissions
Ads for schemes under HMRC challenge may be advertised – but it is particularly important to be clear and upfront about the potential risks to customers of entering into the challenged arrangement.
HMRC investigation does not necessarily mean that a claimed tax advantage will not be upheld. It does mean, however, that there is a risk that the scheme will not successfully deliver the tax advantages claimed, which should be disclosed. Omission of the disclosure of risk of entering the scheme is a problem.
The Erudite Partners website has not laid out any of the risks of entering into their tax arrangement as laid out in the Enforcement Notice.
The CAP Compliance team contacted Erudite Partners Ltd and, in the absence of a response, took the decision on 03 June 2024 to place Erudite Partners Ltd’s company details on this section of the ASA website. These details shall remain in place until such time as Erudite Partners Ltd has appropriately amended the https://eruditepartners.co.uk website to ensure compliance with the CAP Code.
