MSC's

[Bluebird]

According to the budget an MSC is the following:

"Managed Service Companies
i) Definitions and scope
The definitions of what constitutes a MSC and a scheme provider have been significantly tightened. It is now entirely clear that ordinary contractors using limited companies are out of scope, as are PAYE umbrellas.

A MSC is a company that does ALL of the following:
1) provides services of individuals to other persons
2) makes payments to those individuals (no change from previous proposals)
3) makes payments exceeding what the individual would have received if it had been employment income
4) is a person who promotes and facilitates the provision of services and is involved in the running of the company (NEW - this is intended to single out the scheme provider as distinct from other companies providing services)

"Involvement" in the sense of (4) entails ONE of the following:
- the provider benefits financially on an ongoing basis from the provision of services
- the provider influences or controls the provision of services
- the provider influences or controls the payments to individuals
- the provider influences or controls the company's finances or activities
- the provider gives an undertaking to make good any tax loss."

I may be missing something but doesn't that make Agents MSCs ?

[malvolio]

It did, but they have just managed to get themselves exempted from the scope. I think that's a good thing, overall, but others may disagree.

Though it might be an interesting way to persuade clients that agencies are not the supplier, merely a facilitator - if they were actually supplying staff, they would be MSCs and could not trade in the way they do.

[mictech]

There are a lot of agencies that do both. I have work a few times as contract and found the guy next to me directly employed by the agency and on a pitance of my rate, not that my rate is that good.

So will they be sacking all them guys or probable have another branch deal with them. So we should have for example, Computer people EB, Computer People umbrella etc.

[malvolio]

No, agencies are perfectly entitled to have PAYE contractors - I know more than a few myself, who for various reasons don't want to be out-and-out freelances (one, for example, is a busy county councillor who would have a conflict of interest if he were). They are paid salarymen, no different to being an umbrella's clients and nothing like an MSC client.