Montpelier not affected by new tax laws?

[lamboman]

OK, I am with Steed but they will no longer be able to process my payments.

My limited co is still running and I need to decide whether to use this (which is my last resort), or go for another offshore (?) like Montpelier who apparently are not affected by the new tax rules...

Can anyone confirm Montpelier's posiiton?

Thanks

[Cowboy Bob]

They're telling porkies. If you are living and working in the UK, you are tax resident in the UK and therefore you will be liable for any tax changes that come in April.

[Bernard]

They're telling porkies. If you are living and working in the UK, you are tax resident in the UK and therefore you will be liable for any tax changes that come in April.

That is what the Inland Revenue would like you to believe. We believe our tax planning continues to work notwithstanding the new regulations.

Bernard O'Kelly

[malvolio]

So you're willing to underwrite your client's losses if you're wrong?

[Vito]

So you're willing to underwrite your client's losses if you're wrong?

Nice!

[tim123]

So you're willing to underwrite your client's losses if you're wrong?

And if they don't, the tax debt will now pass to the agency (if the contractor wont/can't pay it).

Are any agents really going to let their contractors work through an offshore company that looks like an MSC?

tim

[Bluebird]

Computer People might

[malvolio]

That's OK, nobody in their right mind uses a CP contract anyway.

[IR35 Avoider]

Are any agents really going to let their contractors work through an offshore company that looks like an MSC?

There has always been reason for agencies to avoid paying direct to off-shore companies. An HMRC document I read many years ago indicated that if a chain of payments from client to worker went off-shore, they would recover unpaid NI from the last UK link in the chain.

Offshore entities can have an on-shore subsidiary that passes the money on, so I'm not sure how the agency can tell if a scheme is being used. Not sure what their liability would be under MSC rules. Previous tax legislation has always insulated the paying party from any responsibilities if they paid a UK limited company.

[tim123]

. Not sure what their liability would be under MSC rules. Previous tax legislation has always insulated the paying party from any responsibilities if they paid a UK limited company.

Under the new rules they can be chased for the unpaid tax and their liabiliy would initially be whatever HMRC decide it should be.

There isn't just the risk that the agent are actually liable for the tax, there is the much bigger risk that HMRC will decide that they are the easiest fish to catch and chase them first. Fighting HMRC in court over this issue could bankrupt a small agency, even if they never actually become liable for the tax.

Under the new rules, if I were running an agency I would make sure that all of my cons was either: working through his own one man limited or through a recognised brolly. Anything else is far too risky.

Anicdotal evidence suggests that many agencies ARE taking this view.

tim