Overdrawn Capital Account Scheme (Aston Mae / Glen Mae / Procorre)

[cojak]

This so much no longer feels like a EBT or loan scheme investigation, it feel so much more like an MSC investigation. Did you guys who used Procorre have LTDs not umbrellas?

No Greg, it really isn’t - they are much more embedded than that. Procorre sucked up contractor’s Ltd’s and basically assimilated them (into an LLP), like the Borg.

[DealorNoDeal]

No Greg, it really isn’t - they are much more embedded than that. Procorre sucked up contractor’s Ltd’s and basically assimilated them (into an LLP), like the Borg.

I must admit, I can't get my head around this scheme. I presume it was designed to save tax but I can't fathom it out.

If it's confusing HMRC, I'm not surprised.

[mightyspur]

I must admit, I can't get my head around this scheme. I presume it was designed to save tax but I can't fathom it out.

If it's confusing HMRC, I'm not surprised.

My issue with it all, is Procorre were quite adamant (and are still arguing that with HMRC) that it wasn't a scheme, when I explicitly asked the question. It was all about being part of a larger partnership and the benefits that brings. I do now think they realised in 2018 that the overdrawn capital accounts were going to get swept up in the loan charge legislation and so offered to acquire your Ltd company in order to reconcile those balances, which is why most people it seems had their companies valued at just over what was received from the ODC account.

People on the ODC arrangement who didn't go through with the acquisition, presumably felt safe as they had paid taxes on the allocated profits, with some people actually saying they ended up paying more than if they had stuck to just paying themselves via dividends etc.

It seems the whole arrangement was more a tax deferment scheme than tax avoidance. My accountant at the time suggested I would effectively be tax neutral, which is why I didn't worry. Seems I was an idiot and my accountant didn't know what he was talking about though.

[cojak]

I must admit, I can't get my head around this scheme. I presume it was designed to save tax but I can't fathom it out.

If it's confusing HMRC, I'm not surprised.

The only punters who can trust belonging to an LLP are solicitors and accountants (I wonder why ). Anyone else opens themselves up to sharks.

[Fred Bloggs]

I must admit, I can't get my head around this scheme. I presume it was designed to save tax but I can't fathom it out.

If it's confusing HMRC, I'm not surprised.

My thoughts would be that nobody outside Procorre and it's advisors know how it really works. Curiosity had me looking into it ages ago but I soon concluded it was deliberately extremely opaque. Their website was a fantastic example of saying a great deal but meaning nothing. I could never understand for example, the blue chip companies they claimed to be working in, nobody I knew in those companies had a clue who Procorre were. There's more but in a nutshell I soon concluded it was impossible to find out exactly how Procorre and their structure worked. Nor was it possible to determine exactly what they did.

[nucastle]

People on the ODC arrangement who didn't go through with the acquisition, presumably felt safe as they had paid taxes on the allocated profits, with some people actually saying they ended up paying more than if they had stuck to just paying themselves via dividends etc.

Ended up paying more since their 'tax deferment' ends up getting lumped on top of future earnings with their pie in the sky profit allocations, or via the loan charge - so all your 'income' was taxed at higher rate, rather than going through the bands.

It was sold to victims as a tax efficient way of paying yourself (via a trust or ODC), while they collected 17% off the top of your earnings as a fee for running it (83% retention!). All they had to do is offer a few value add services on top which were pretty much just introduction services to mortgage brokers, or recruitment agents and bobs your uncle.

Since the scheme introductions were made by third parties they could then claim ignorance that this was never a tax dodge. Handy for them.

The moment I got my first Section 9A letter from HMRC in 2015 it dawned on me that I'd been had, and would eventually have no leg to stand on, nor would the people who peddled this to me have to cough up anything from Singapore or Switzerland, so started saving up for all the tax I knew they would come for. Thankfully their own glacial progress bought me some time ahead of the loan charge, but I still have another two years of my TTP arrangement to go.

The purchase of my LTD felt like some kind of hail mary play from them the moment I heard about it, and ran a mile when they suggested it to me. I feel sorry for anyone who compounded their personal tax affairs with that of their LTD company on top of it.

[frontmen242]

Procorre Legal do appear to be fairly useless in terms of trying to get hold of them, but I don't think they have closed. I think they are just overwhelmed with the number of enquiries they are dealing with. It seems impossible to get hold of anyone on the phone for example. I can only suggest you keep hassling them for the response, because they usually send their replies out of the blue past the arbitrary deadline imposed by HMRC, but they have always sent me something, despite emailing them every single day leading up to the deadline, not that those replies do any good in terms of how HMRC view things.

I have only spoken to WTT and it would appear that they know what they are talking about and even have a section on their website that references the Procorre scheme directly. I am sure there are other advisors available though

I would just like to say after emailing Procorre Legal for a 2nd time yesterday, I got a reply saying they will respond before the deadline and drafting the response they probably give to everyone, typically that's just under a month away so they like to keep it all last minute... never mind my nerves... also that they have a huge backlog I wonder why? I'm guessing its a case of watch this space....

Speaking to WTT next week - looking forward to some simple honest advice... keep you all posted.

[mightyspur]

I would just like to say after emailing Procorre Legal for a 2nd time yesterday, I got a reply saying they will respond before the deadline and drafting the response they probably give to everyone, typically that's just under a month away so they like to keep it all last minute... never mind my nerves... also that they have a huge backlog I wonder why? I'm guessing its a case of watch this space....

Speaking to WTT next week - looking forward to some simple honest advice... keep you all posted.

Procorre suddenly seem to be sending an acknowledgement email saying they have received the email/letter and in the process of drafting a response. It's better than just complete radio silence I guess, but all a bit, "please stay on the line, your call is important to us"

[NickLeeson2]

Has Proccorre given an explanation to anyone. People have different deadlines and as far as I can tell, no one has received a response from Procorre, other than the generic email stating they will respond before the end date.

Does signing the LLP agreement with Procorre hold any value? I thought that under LLP, the responsibility is shared but the tone of the letters from HMRC indicate that the employee and their LTD company are liable.

[srowell8]

I am a 1st time poster on here having received an HMRC disguised loan demand yesterday. I did 1 contract for Procorre in 2014 for a relatively low value over 6 months now I have a tax demand for nearly 3x the value of the money I received - surely this can't be correct/legal etc. I have a call with WTT tomorrow and seeing this thread they seem to be the people who are looking into this for a number of people. My accountant is holding me back from talking to Procorre just now. I have a couple of questions 1 - Has anyone on here actually reached a resolution with HMRC 2 - I don't fully understand the loan value as I never received this money can someone explain ? . I was a sole-trader so didn't sell my business to them thankfully. Many thanks