In September 2026, HMRC warned contractors about payslip fraud in the umbrella company market. We covered the warning signs in “HMRC’s Payslip Fraud Warning: What Umbrella Contractors Need to Know”, published on 30 September. This follow-up explains how to check that your umbrella payslip complies with HMRC’s rules using HMRC’s own tools, and what to do if the figures don’t match.

Why verifying your payslip matters

Your payslip is the main record of your pay, the Income Tax you have paid and your National Insurance contributions (NICs). If those figures are wrong, or not reported to HMRC, it can affect your State Pension record, eligibility for some statutory benefits, and your tax position.

Under section 8 of the Employment Rights Act 1996, every worker has the right to an itemised pay statement showing gross pay, the amount and purpose of each deduction, net pay and, where pay varies with time worked, the hours paid. HMRC notes that grouped deductions can hide the true amount of tax and NICs. If anything is grouped or missing, look into it before your next pay date.

What your payslip should show

Our fraud warning article lists everything a compliant payslip should include. For the checks below, you need these figures:

• Assignment rate. The rate your agency pays your umbrella company, and the days or hours you were paid for. See your assignment schedule, Key Information Document or pay statement.
• Gross pay, including any rolled-up holiday pay.
• Income Tax and employee NICs, shown as separate lines.
• Net pay, which should match the amount paid into your bank account.
• Employer NICs and the umbrella margin. These are taken from the assignment rate before your gross pay is worked out, so they may appear on your pay statement (also called a reconciliation statement) rather than the payslip itself.
• Your tax code and any pension or student loan deductions.

If a figure is missing, ask your umbrella company for a breakdown.

Using HMRC’s umbrella pay tool

HMRC’s “Work out pay from an umbrella company” tool estimates your gross pay, net pay and deductions for a single role. HMRC says it is anonymous and doesn’t collect identifying details about you or your umbrella company. It covers the current tax year only and is most accurate if you are aged 21 or over and under State Pension age.

• Open the tool on GOV.UK and select “Umbrella company worker”.
• Enter your assignment rate (hourly or daily) and the days and hours you are paid each week.
• If you have a payslip, enter your gross and net pay. You will also be asked about the umbrella margin, workplace pension, tax code, Apprenticeship Levy and student loan.
• Review the results. If you entered payslip figures, the tool shows your payslip next to HMRC’s estimate, followed by a breakdown: margin, employer pension, employer NICs, gross pay, Income Tax, employee pension and employee NICs.
• Compare each line with your payslip and pay statement.

Check the employer NICs and margin lines closely, as they are deducted before your gross pay is calculated. Small differences can be legitimate: HMRC says the results are illustrative and rely on assumptions such as rolled-up holiday pay and minimum pension contributions. You can save or print your results.

Checking your HMRC Personal Tax Account

The tool shows what your deductions should be. Your Personal Tax Account shows what your umbrella company has reported to HMRC through Real Time Information (RTI), the submission employers make each time they pay you.

Sign in to your Personal Tax Account on GOV.UK, or use the HMRC app.

• Check that your umbrella company is listed as your employer and that the name matches what you expect.
• Compare the income and Income Tax shown for that employment with your payslips. You can also view income and tax for the previous five years.
• Check that your tax code matches the one on your payslip.
• Check your National Insurance record, also available through your account, to confirm contributions are being recorded.

HMRC’s guidance for umbrella workers recommends checking that the deductions on your payslip match the amounts in your Personal Tax Account. A difference may mean a submission hasn’t been processed yet, there’s a payroll reporting error, or your employer changed without your request. Recent pay may not show straight away, so allow time before treating a gap as a problem.

HMRC’s payslip check guidance

HMRC also publishes “Check your payslip is correct if you work through an umbrella company”. It explains what to check on your payslip and pay statements, includes example payslips, and describes payments that may point to tax avoidance. It also confirms you can ask for a breakdown of your deductions and, if you work through an agency, a Key Information Document. It ends with HMRC’s reporting route, covered below.

What to do if something does not match

Contact your SmartWork business manager. Send the payslip, your tool results and your Personal Tax Account figures. Your business manager will investigate and either explain the difference or correct it.

Keep records. Save copies of your payslips, pay statements, tool results and any written correspondence.

If the issue is not resolved, HMRC asks you to report suspected tax avoidance or fraud through its “Report tax fraud or avoidance to HMRC” online form, adding the reference “TAC”. You can also call the HMRC fraud hotline on 0800 788 887, Monday to Friday, 9 am to 5 pm. You do not have to give your personal details.

If you think you are in an avoidance scheme, HMRC’s “Tax avoidance: getting out of an avoidance scheme” contact page offers help to leave it.

How SmartWork protects contractors

Your own checks are one layer. SmartWork also has two external checks in place:

1. SafeRec certification. SafeRec audits payslips as they are generated via a direct link to the payroll system and cross-references them against the RTI data submitted to HMRC. It also checks each certified company’s HMRC tax account monthly to confirm that declared tax has been paid. Certification includes a legal and operational review by a regulated law firm.
2. FCSA accreditation. Independent chartered accountants and solicitors assess accredited members every year against the FCSA Codes of Compliance.

For most SmartWork contractors, the checks in this guide will confirm that everything is in order. They are worth running periodically as part of your routine, especially when you start a new assignment.

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