HM Revenue & Customs has petitioned Glasgow Sheriff Court to wind up T.U Pay and T.U PAYE, two linked companies recently named on the tax authority’s list of suspected tax avoidance scheme promoters. The Advocate General for Scotland has brought the action on HMRC’s behalf, and is seeking the appointment of a liquidator to oversee the firms’ closure.
According to HMRC, the suspected schemes appear to have drawn in workers employed by NHS bodies and Scottish local authorities, some of whom may have been unaware they were entering into disguised remuneration arrangements. The legal action follows an earlier investigation by investigative outlet The Ferret, which reported that Scottish “umbrella” companies had been used to channel public sector staff into questionable pay structures.
T.U Pay and T.U PAYE’s financial position
Recent accounts show T.U PAYE reported capital and reserves of £638,628 between March 2025 and February 2026, employing an average of 287 people in that period. Sister company T.U Pay’s accounts for the year to April 2025 recorded a deficit in capital and reserves of £349,507, with an average workforce of 157 staff.
Both companies were added to HMRC’s public list of organisations linked to suspected tax avoidance schemes prior to the court petitions being lodged. Inclusion on this list is one of the tools HMRC uses to warn taxpayers and advisers away from arrangements it believes are designed to avoid income tax and National Insurance.
Impact on NHS and council workers
HMRC says it has reason to believe that individuals using T.U PAYE’s services, as well as those connected to T.U Pay, include NHS and local authority staff working across Scotland. Workers engaged through umbrella companies can sometimes be routed into complex pay models involving loans or non‑standard deductions, which HMRC treats as tax avoidance if they are designed to reduce income tax and NICs.
The Ferret’s reporting suggested some temporary NHS and council workers had been “duped” into such schemes, potentially leaving them exposed to unexpected tax bills if HMRC deems the arrangements to be avoidance. HMRC has repeatedly warned that individuals remain responsible for paying the correct tax, even where they have been introduced to schemes by employers, agencies or intermediaries.
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Part of a wider HMRC crackdown
The move against T.U Pay and T.U PAYE is part of a broader clampdown on promoters of tax avoidance schemes, which has seen the UK government grant HMRC additional powers and sanctions in recent years. These include the ability to name suspected promoters publicly, issue “stop notices” to force firms to halt sales of particular schemes, and seek significant financial penalties for non‑compliance.
HMRC has also stepped up investigations into businesses and individuals across multiple tax heads, including VAT, as it seeks to narrow the UK’s estimated tax gap. Officials argue that taking firm action against scheme promoters helps protect both public finances and workers who might otherwise be drawn into arrangements they do not fully understand.
