Hello DQ
I am sorry to confirm that you have described a very typical scam. There are some things you should do, but it is most unlikely you will get any of your money back. You will never be able to do what is right in order to get paid and so you'll never move on to getting paid. They can still say they really have work for you but you're just not good enough or not up to their standards. As you know from experience, companies in the real world do not operate like that. Sure you must have good standards but what these people are asking for is intentionally impossible.
Please make a fuss about this. As you are UK based send a copy of the letter you sent me to your local Trading Standards. There might even be an email contact for your local one. Although there is a limit to what Trading Standards can do they can at least keep a record of it and somewhere along the line could help to nail the perpetrators.
You could also write to your local newspaper - they might publish your letter as it will help to warn others.
You can try contacting the company to tell them you are contacting Trading Standards and your local newspaper to persuade them to try to return your money. Sadly, many people who are scammed do not talk out about it so it would help if you could in order to warn others.
Good luck and please let me know how you get on.
Kindest Regards
Agony Aunt