Last night I received a briefing note from Blake Lapthorn Tarlo Lyons, a huge legal practice with particular specialism in the contracting industry. I can't copy and paste this here as it is on a pdf although I can send a copy if anyone is interested.
HMRC's briefing note issued on 30/03/07 says that "professionally qualified persons normally would not be considered to be an MSC Provider except to the extent that they are in the business of promoting and facilitating the use of companies to provide the services of individuals.".
Tarlo Lyons interpretation of this includes the following:-
"It may be an essential ingredient for the accounting services company to be owned by (a) qualified professional(s) with qualified professional(s) supervising the operations of the accounting services company, and with current practising certificates from a body like the ICAEW or the Law Society."
I have stated previously that I think this is a possibility and the wording of HMRC's guidance note and this advice from BLTL now strengthens that.
HMRC will have to clarify what is meant by professional accountants and the obvious thing to do is to include those regulated by a recognised authority because:-
I think that those who do not use an accountant regulated by the ICAEW are at risk of falling within the MSC legislation. The impact of this is that the company must pay all of its income back out to the shareholder/director under PAYE. Further, unlike IR35, if it does not, the unpaid taxes can be collected from the director/shareholder personally. Is that a risk you are prepared to take?
Naturally, I wouldn't expect the non-Chartered accountants who post on this board to accept this but BLTL have no hidden agenda and the HMRC guidance notes refer specifically to "professionally qualified persons" so make your own minds up how that is likely to be enforced.
HMRC's briefing note issued on 30/03/07 says that "professionally qualified persons normally would not be considered to be an MSC Provider except to the extent that they are in the business of promoting and facilitating the use of companies to provide the services of individuals.".
Tarlo Lyons interpretation of this includes the following:-
"It may be an essential ingredient for the accounting services company to be owned by (a) qualified professional(s) with qualified professional(s) supervising the operations of the accounting services company, and with current practising certificates from a body like the ICAEW or the Law Society."
I have stated previously that I think this is a possibility and the wording of HMRC's guidance note and this advice from BLTL now strengthens that.
HMRC will have to clarify what is meant by professional accountants and the obvious thing to do is to include those regulated by a recognised authority because:-
- It is easy legislation to write
- It is easy legislation to police
- It is effective in that it is very difficult to avoid and catches most of those intended to be caught.
I think that those who do not use an accountant regulated by the ICAEW are at risk of falling within the MSC legislation. The impact of this is that the company must pay all of its income back out to the shareholder/director under PAYE. Further, unlike IR35, if it does not, the unpaid taxes can be collected from the director/shareholder personally. Is that a risk you are prepared to take?
Naturally, I wouldn't expect the non-Chartered accountants who post on this board to accept this but BLTL have no hidden agenda and the HMRC guidance notes refer specifically to "professionally qualified persons" so make your own minds up how that is likely to be enforced.
) are saying that although I am an established business, providing book-keeping services to many sectors including contractors, have over 20 years experience in my field (including 8 years working for HMRC), have liability and PI insurance for my business, have full qualifications in other fields but am only a part-qualified accountant (and note that I never claim otherwise, anywhere) I am automatically an MSC scheme provider just because I don't hold (or claim to hold) a full accounting qualification and/or an ICAEW practising certificate or similar?
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