Giant pull their Trailblazer service

[THEPUMA]

OK but playing devil's advocate, Giant have a huge client base. They could have created a genuine uncontrolled PSC product and offered it as an alternative to those that they will otherwise lose.

I think the reason they have pulled this is that they will be the first port of call for the MSC Inspection Dept and the rules are so ambiguous that it is impossible for them to design such a product. So he has taken his money and run.

[PAG]

Since Giant founders are accountants, surely they could have offered an alternative product such that they would transfer all the authority for running the company to their clients and retain them by offereing only accontant services.

[The Lone Gunman]

I would like our pet accountants to comment on this, possibly any legal bods too.

I know what you are saying Malvolio, but HMRC are not renowned for accepting any view point other than their own.

HMRC sees us, that is one man (I know you have 2 directors) Ltd companies who provide services rather than products, as PSCs.

Giant seem to be saying:
If a PSC uses an accountant for anything more than doing the companies accounts once a year then they will fall foul of this new legislation.
This will bring the accountants into the firing line for unpaid tax collection.

If the above is correct then we are likely to see a whole host of backtracking once HMRC realises how many other companies will be affected.
This could be a whole new can of worms.

Simon, Darren and the NW chap (sorry I forgot who you are). We would all appreciate some advice here.

Should we (and you) be worried?

[simondolan]

OK but playing devil's advocate, Giant have a huge client base. They could have created a genuine uncontrolled PSC product and offered it as an alternative to those that they will otherwise lose.

I think the reason they have pulled this is that they will be the first port of call for the MSC Inspection Dept and the rules are so ambiguous that it is impossible for them to design such a product. So he has taken his money and run.

And how you would recruit and gear up for say 5000 clients in the space of a few weeks? Giants strengths lay in the processing capabilities. Give the contractors a real Company with the client having full control and you cannot then systemise it - you have to recruit real accountants rather than admin people and that is extremely expensive and time consuming (as you know!)

Also, the fact is that an umbrella can be more profitable than acting for Ltd Cos - if Giant can convince enough people (which is what this PR was designed to do) that everyone will be caught by the MSC rules then they stand to make more income from those that believe them.

[THEPUMA]

"And how you would recruit and gear up for say 5000 clients in the space of a few weeks? Giants strengths lay in the processing capabilities. Give the contractors a real Company with the client having full control and you cannot then systemise it - you have to recruit real accountants rather than admin people and that is extremely expensive and time consuming (as you know!)" (how do you do that fancy box thing by the way?!

That is a fair point. I think they would have had some in-house expertise from their MSC product, I think they probably would have run the Powerhouse until August when the debt provisions come in and in the meantime they would have been able to recruit like mad and so even if they couldn't cater for the full 5,000, they wouldn't have lost the lot.

I think the new rules are a sledgehammer to crack a nut and it may well be that who they go after will boil down to HMRC policy. This is not ideal and if someone wants to make a name for themselves, anyone could be in the firing line.

[Bigbird]

I would like our pet accountants to comment on this, possibly any legal bods too.

I know what you are saying Malvolio, but HMRC are not renowned for accepting any view point other than their own.

HMRC sees us, that is one man (I know you have 2 directors) Ltd companies who provide services rather than products, as PSCs.

Giant seem to be saying:
If a PSC uses an accountant for anything more than doing the companies accounts once a year then they will fall foul of this new legislation.
This will bring the accountants into the firing line for unpaid tax collection.

If the above is correct then we are likely to see a whole host of backtracking once HMRC realises how many other companies will be affected.
This could be a whole new can of worms.

Simon, Darren and the NW chap (sorry I forgot who you are). We would all appreciate some advice here.

Should we (and you) be worried?

Although not a pet one, I run my own business providing book-keeping services to small businesses and have done since early 2004. Before this April I had 3 consultant clients whose company books I do who would fall under the definition of a "PSC" for IR35 purposes - I prefer to call them 1-man Ltd businesses personally.

During April I have agreed terms with 10 more and am currently in the process of either helping them to set up or transferring their existing records to my systems.

In the same period I have been innundated with enquiries from people coming out of composites who want to know what I charge, whether I could help them etc. I reckon I'm getting between 10-15 phone calls a week whereas previously I would have maybe 1-2 a month if I was lucky. I assume these people are literally just picking numbers out of the yellow pages or something.

I am reluctant to take on many more contractors at the present time though, not because I don't have the capacity (it's simple work for the most part and I can always expand ) but because when I rang HMRC to see if I would fall within the definition of an MSC scheme provider they couldn't tell me!

The best I could get was "probably not" because I don't promote my services as a scheme and I do work for other businesses who are Ltd but set up under different models or sole traders etc. However, I do (or did) offer Registered Office and Co Sec services for a premium, I have currently suspended these for new clients til I get a definitive answer that performing these duties won't put my clients or myself at risk from the new rules If my client base in this area continues to expand however until it forms the majority of my work that could be an indicator that I am in fact promoting a scheme......... so basically my trade has been curtailed to a degree until a test case comes to court maybe.......

So I too am interested in the "big boys" point of view.......

[Darren@UptonAccountants]

Tax

I would like our pet accountants to comment on this, possibly any legal bods too.

I know what you are saying Malvolio, but HMRC are not renowned for accepting any view point other than their own.

HMRC sees us, that is one man (I know you have 2 directors) Ltd companies who provide services rather than products, as PSCs.

Giant seem to be saying:
If a PSC uses an accountant for anything more than doing the companies accounts once a year then they will fall foul of this new legislation.
This will bring the accountants into the firing line for unpaid tax collection.

If the above is correct then we are likely to see a whole host of backtracking once HMRC realises how many other companies will be affected.
This could be a whole new can of worms.

Simon, Darren and the NW chap (sorry I forgot who you are). We would all appreciate some advice here.

Should we (and you) be worried?

Afternoon LG, completely agree with Alan's comments earlier, if you run & own your own Ltd then you're not caught.

Very decent of Giant to pull this product, been an interesting day for new work! Nothing to worry about for all those who manage their own Ltd like our clients.....they have control over the finances and management of the company and naturally operating as a genuine stand alone business.

[Darren@UptonAccountants]

Giant

Since Giant founders are accountants, surely they could have offered an alternative product such that they would transfer all the authority for running the company to their clients and retain them by offereing only accontant services.

Wonder if they are just scaling down their operations in light of a bit of bad press and dwindling numbers of clients in order to concentrate on their core operations.

[The Lone Gunman]

Afternoon LG, completely agree with Alan's comments earlier, if you run & own your own Ltd then you're not caught.

Very decent of Giant to pull this product, been an interesting day for new work! Nothing to worry about for all those who manage their own Ltd like our clients.....they have control over the finances and management of the company and naturally operating as a genuine stand alone business.

Thanks Darren. Can I hold you to that?

[cortez]

Lets get together and sue GIANT as a collective

Giant have actually screwed thousands of people. It;s no secret that there are thousands of contractors who just want to make as much money as they can since they dont have the same perks of Perm staff.

I went the whole hog with giant: set up a limited company through them, registered for PAYE, was on the last leg waiting for the promise from Giant to set up the operating business account , then they drop this on me.

Other umbrella companies claim this legislation was not so "new" as giant claim and they were all prepared for it. Why not Giant who were actively promoting Trailblazer all the while ???

Giant either stupidly took a risk that it wouldnt go through parliament or actually used this as a ploy to get people to sign, then have no option but to roll over to their strongbox. (they are actually calling it an option ..... ??? as opposed to what?) Think about it, tax year ends in 2 days. What the hell do you do at the 11th hour. Giant should be dishing out compensation to people affected by their actions. Just to let you know taking their Strong Box option is a foolish option. There are better options !!