[Expert Session Recap] Preparing for Joint and Several Liability: Is Your Supply Chain Ready?

Joint & Several Liability Goes Into Effect 6 April 2026

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January 29, 2026

The New Reality of UK Contractor Tax

On 28 January 2026, Worksome hosted an expert panel to demystify the upcoming UK Umbrella Tax Reform. The session featured Rebecca Seeley Harris (Employment Status & IR35 Expert) and Chris Bloor (Director of Compliance at Parasol), who joined Worksome’s Sam Orrin to discuss Umbrella Tax Reform and the upcoming enfrocement of Joint & Several Liability.

The core of that discussion—and the most critical takeaway for HR, Finance, and Procurement leaders—is the reality of Joint and Several Liability (JSL).

For years, if an umbrella company failed to pay its taxes, the problem stayed with the umbrella. That ends on 6 April 2026. Under the new JSL rules, HMRC is effectively making the entire supply chain responsible for unpaid PAYE. If an umbrella company in your chain defaults, HMRC can now look "upstream"—meaning your recruitment agency or your own organisation could be left picking up the bill.

"Joint and several liability means you can be 1% involved and still face 100% of the claim. Due diligence is a necessity, not an option." — Rebecca Seeley Harris, Employment Status & IR35 Expert

What Joint and Several Liability Means in Practice

JSL creates a "chain of responsibility." The panel clarified that if a tax shortfall occurs, liability rests with the "Relevant Party":

The Top Agency or MSP: If they are in a direct contractual relationship with the client.
The End Client: If no umbrella is in the chain (direct agency employment) or if the umbrella and agency are "connected."

Chris Bloor, Director of Compliance at Parasol, notes that this reform is designed to force a behavioral change: "HMRC had to arrive at something that made the agencies and clients give a shit where that money went. It was no longer 'pass over and look the other way.' That just couldn’t happen anymore."

Step 1: Supply Chain Mapping & Forensic Auditing

You cannot manage what you cannot see. Rebecca Seeley Harris advises that the first step for any HR or Finance leader is to map the labor supply chain end-to-end.

Identify Every Intermediary: Document every agency, MSP, and umbrella.
Verify Relationships: Check Company House to see if umbrella directors are also directors of your agencies (a "connected" relationship triggers client liability).
Audit Historical Patterns: Look for "non-standard" arrangements that act as red flags.

Strategic Tip: Consolidate your Preferred Supplier List (PSL). For more on managing high volumes of talent safely, see our guide on High-Volume Freelancer Management.

Beyond the Payslip: "Reasonable Care" in 2026

A common misconception is that a basic accreditation or a single payslip check is enough. Chris Bloor warns that while tools like SafeRec are vital, they are part of a larger risk management exercise.

"You need to make sure the worker is paid correctly, the payment has been remitted to HMRC correctly, and the tax/NI has been paid over. If you can get that, you can be reasonably comfortable," Bloor explains.

HMRC now expects a robust governance framework, including:

Audit Rights: Ensuring contracts allow you to inspect the financial records of intermediaries.
Continuous Monitoring: Moving away from annual spot-checks to real-time, tech-enabled verification.

How Worksome De-risks Your Transition

As Sam Orrin (Worksome) highlighted in the webinar, tech is the only way to manage this at scale: "When you get into dozens, hundreds, or thousands of contractors, you need a tech-enabled process to understand where your risk is."

Worksome is proactively preparing to safeguard both our clients and our own supply chain under joint and several liability by strengthening visibility, controls, and verification across umbrella arrangements.

This includes:

Enhanced due diligence, going beyond standard checks with real-time verification of payroll and tax remittances
Supplier vetting, only working with trusted umbrella partners that demonstrate strong compliance and financial resilience
Ongoing visibility, with all contracts, payments, and payslips accessible through the Worksome platform
SafeRec-certified engagement, ensuring every payslip is audited and cross-checked against HMRC RTI submissions
Monthly Supply Chain Reporting, showing payslips audited, RTI alignment, and any risks or anomalies flagged
Internal and client readiness, ensuring teams understand the responsibilities and expectations under JSL

Common Questions: Avoidance vs. Compliance

Will organisations shift work to "Services" to avoid JSL?

Rebecca Seeley Harris is already seeing this: "I’m already hearing it... 'How do we avoid it?' One way is the elective deduction model. But HMRC does not like this practice. You need to look at supply chain compliance in its entirety."

What is the cost of compliance?

While there is a cost to accreditation and auditing, Bloor argues the value outweighs the risk: "The cost of an FCSA accreditation or SafeRec is with the umbrella. The risk management is your ongoing process. It will be worth it compared to the potential payout."

Is a Payslip Audit Enough?

Rebecca Seeley Harris: "It’s a great start, but no—verification is not a 'silver bullet.' Tools like SafeRec are vital because they provide real-time auditing, but they are checking a payment that has already happened. HMRC’s standard for 'reasonable care' goes deeper than just the payslip.

To protect your organisation, you must audit the structure of the provider. Are the directors clearly identifiable? Are there any 'connected' parties between the agency and the umbrella? Are they operating as a genuine Employer of Record? You need technology to flag the anomalies, but you need a governance framework to ensure you're choosing the right partners from day one."

Chris Bloor added: "It’s about prevention, not just detection. You want to be in a position where you aren't just catching errors, but working with providers who have been through yearly assessments and weekly checks. If an umbrella company isn't willing to be that transparent by April 2026, that is your first red flag."