Who carries the umbrella risk in your chain — and what is on file?
Free tool · Agencies
Say where you sit in the supply chain and tick what you already hold. It tells you who is jointly and severally liable for an umbrella's PAYE since 6 April 2026, and lists the gaps in your file.
Since 6 April 2026, Finance Act 2026 makes the agency that holds the contract with the end client jointly and severally liable with an umbrella company for the PAYE and National Insurance on its workers' pay. The umbrella still runs the payroll; if it does not pay, HMRC can come to the agency for the whole amount. Where the end client contracts with the umbrella directly, or through an agency outside the UK or connected to the umbrella, the client carries it instead.
There is no statutory list of records to keep and no due-diligence defence. What HMRC does say is that you should keep a record of the checks you make, and it names four. They lead the checklist here, followed by the provider, pay-period, contractual and internal records that make those checks stand up.
It is a records exercise, not a restructuring — for most agencies, a fortnight of somebody's attention.
April 2026 evidence checklist
The printable pack
April 2026 evidence pack
Who is jointly and severally liable, and a checklist to work through for every umbrella in your chain — HMRC's recommended checks first.
The detail behind it
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Where this leads
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From 6 April 2026 the agency holding the contract with the end client is jointly and severally liable with the umbrella for its PAYE and National Insurance. The umbrella still runs the payroll. There is no due-diligence defence, so keep a record of the checks you make.
Not in law. There is no due-diligence defence: if an umbrella fails to pay, HMRC can still pursue the liable party. Good records make it less likely to come to that, show you acted with care, and let you drop a provider that will not supply evidence.
The liability sits with the agency that holds the contract with the end client, not with you. Expect that agency to ask you for the same evidence and to write it into your terms, so it is worth holding anyway.
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