HMRC may not recover the full tax debt reported against umbrella company Exchequer Solutions after it entered administration and its assets were sold to a connected company in a same-day pre-pack. Computer Weekly reported in September 2024 that the administrator’s report put the interest-inclusive tax liability at around £15 million, while just under £7.5 million was available for creditors. The final distribution and HMRC’s eventual recovery were not established in that report.
What happened to Exchequer Solutions?
Exchequer Solutions entered administration on 15 July 2024. On the same day, its assets were sold to Exchequer Contracts, a connected party that Computer Weekly reported shared a director with Exchequer Solutions. The transaction was a pre-pack administration overseen by insolvency practitioner Leonard Curtis. Computer Weekly said the administrator’s report was published on Companies House on 4 September 2024. Computer Weekly’s account is the basis for the administration and claim details below.
Why was HMRC claiming unpaid tax?
HMRC began investigating Exchequer Solutions in October 2015 over its treatment of contractor expenses. The company believed it employed workers under an overarching contract and treated each assignment as a temporary workplace. On that basis, it reimbursed expenses such as mileage and subsistence without deducting PAYE income tax or National Insurance contributions (NIC).
As reproduced by Computer Weekly, the administrator’s report explained the company’s approach: “The umbrella product involved employing the individual completing the work rather than engaging them on a self-employed basis.” It added: “As a result, there was no PAYE [Pay As You Earn] or NIC deducted on the expenses claimed.”
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According to Computer Weekly, HMRC concluded in October 2015 that Exchequer Solutions owed £11.9 million in unpaid income tax and National Insurance. The company unsuccessfully appealed HMRC’s claim at the First-tier Tribunal in 2022 and the Upper Tribunal in January 2024.
How much was owed, and what might HMRC recover?
The figures reported by Computer Weekly from HMRC’s claim and the administrator’s report describe different things. The estimated amount needed to clear the liability included interest; the funds available were for creditors collectively, not HMRC alone.
| Reported figure | What it refers to |
|---|---|
| £11.9 million | Unpaid income tax and National Insurance HMRC said Exchequer Solutions owed, as reported by Computer Weekly. |
| Around £15 million | The amount the administrator’s report said the company would need to raise to clear the tax liability after interest, as described by Computer Weekly. It is not a confirmed amount recovered or lost. |
| Just under £7.5 million | Funds the administrator’s report reportedly said were available to repay creditors, including HMRC, as described by Computer Weekly. |
Computer Weekly concluded that HMRC was unlikely to receive the full amount owed. The report does not establish the final creditor distribution or the amount HMRC ultimately recovered, so the gap between the estimated liability and available creditor funds should not be treated as HMRC’s confirmed loss.
Why was there no Time to Pay arrangement?
Computer Weekly reported that Exchequer Solutions could have sought a Time to Pay arrangement with HMRC. Its cash-flow forecasts, however, did not anticipate enough money to meet the tax determination alongside current and future HMRC liabilities, so the company did not pursue that option.
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Why were creditors not consulted before the pre-pack?
Creditors, including HMRC, were not consulted before the sale. The administrator’s report said consultation might have led creditors to accelerate legal processes, stop providing services, or terminate customer work. In the administrator’s view, those outcomes could have reduced asset value and weakened the prospects of selling the business as a going concern. That was the stated reasoning in this case, not a general rule that creditors are never consulted in pre-pack administrations.
What does the case mean for umbrella workers?
The case concerns a company’s tax treatment of expenses, its appeals, and the distribution of its assets in administration. It does not establish that every worker paid through an umbrella company faces the same tax issue, or that a worker is personally liable for this company’s debt. A contractor’s position depends on their own arrangements and circumstances; this report alone cannot determine an individual’s legal or tax exposure.
For anyone assessing an umbrella company, the story highlights distinct questions rather than a guarantee of safety: whether the treatment of pay and expenses is clearly explained, whether payroll records show the deductions made, and whether the business has the financial capacity to meet its obligations. Accreditation is a separate consideration, not proof that a company will remain compliant or solvent.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What did accreditation and regulators say?
Computer Weekly reported that Exchequer Solutions joined the Freelancer and Contractor Services Association (FCSA) in May 2020 and was no longer a member when the article was published in September 2024. FCSA chief executive Chris Bryce told the publication that the company had met the association’s liquidity and HMRC-investigation disclosure requirements until it accepted the tribunal findings and its liability crystallised. That is FCSA’s account of its requirements and the company’s membership; it does not mean accreditation guarantees ongoing compliance or solvency.
ContractorCalculator chief executive Dave Chaplin argued that self-regulation had not worked, while Qdos chief executive Seb Maley called for regulation. A Department for Business and Trade spokesperson told Computer Weekly in September 2024: “We are committed to tackling non-compliance in umbrella companies and are actively considering what the next steps are.” That statement reflects the department’s reported position at that time, not a verified account of current policy. Computer Weekly reported that HMRC declined to comment on this individual case and Leonard Curtis also declined to comment.
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