Blanket classification on the MSC scheme provider
If a single company is identified as an MSC under the new law then it will apply to all limited companies made available by that provider.
So now it’s no longer a matter of whether the MSC has control, if your provider has “controlled” or “influenced” you or other contractors in ANY way then you will be caught under these new definitions.
It will only take one individual to fail the definition for all contractors to pay full PAYE.
Parties to be excluded from the MSC regulation
1. Providers of professional “legal and accountancy advice” are specifically excluded from the MSC legislation.
2. Umbrella companies (i.e. those based on PAYE and not dividends) or limited companies operating within IR35 are NOT covered by the MSC legislation.
3. Limited companies operating in side IR35 and paying a deemed salary.
It is imperative that contractors now seek advice from qualified professional companies such as chartered accountants rather than those who were composite providers yesterday and are accountants today.
The recent 500% increase in company registrations was mainly due to composite providers (MSC’s) creating companies to transfer their contractor clients into, but Treasury have seen through this and have changed tack to focus on the small number of MSC providers rather than the thousands of individual companies.
If a single company is identified as an MSC under the new law then it will apply to all limited companies made available by that provider.
So now it’s no longer a matter of whether the MSC has control, if your provider has “controlled” or “influenced” you or other contractors in ANY way then you will be caught under these new definitions.
It will only take one individual to fail the definition for all contractors to pay full PAYE.
Parties to be excluded from the MSC regulation
1. Providers of professional “legal and accountancy advice” are specifically excluded from the MSC legislation.
2. Umbrella companies (i.e. those based on PAYE and not dividends) or limited companies operating within IR35 are NOT covered by the MSC legislation.
3. Limited companies operating in side IR35 and paying a deemed salary.
It is imperative that contractors now seek advice from qualified professional companies such as chartered accountants rather than those who were composite providers yesterday and are accountants today.
The recent 500% increase in company registrations was mainly due to composite providers (MSC’s) creating companies to transfer their contractor clients into, but Treasury have seen through this and have changed tack to focus on the small number of MSC providers rather than the thousands of individual companies.
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