Churchill Knight & Boox clients being investigated as Managed Service Companies

[Hareforthebear]

Do you believe they are actively fighting it? I honestly don't trust anything from them.

No idea. They talked a good game initially but then have been awfully quiet. Although given how slow the wheels at HMRC seem to turn, maybe they are and they’re in the same boat as us pending some sort of meaningful update from HMRC. As far as I’m aware, no-one has even had a response with the working for the figures provided of the claims they have made. I know I haven’t.

[GregRickshaw]

The news that Boox is gone is not surprising, especially as they have been unresponsive for a long time.

I've been in the process of closing down my business and have not traded with them for the past year, so at least I am not affected on the day to day basis.

Some questions I do have (some that apply to myself but also for Boox clients at large):

- Will HMRC allow them to close?
- In terms of the chain of liability...my understanding is HMRC will chase the alleged MSC> The Director of Alleged MSC > the 'alleged' MSCP > the end clients...what happens if an alleged MSCP has gone?
- Do we think this is going to affect the appeals process (guessing yes!)
- If Boox had supplied the appeals letter should clients now approach HMRC to ask for any points of contact to change
- Why do we think that Limelight Accountancy would have taken on the Boox clients knowing the risk?
- Thoughts on Limelight? They have tiered pricing for various services...hmmmm?!?!?

You have the chain of liability correct yes, which is why CKA are supporting their clients so well (and in general still running their business pretty well) as they know there are plenty of alleged MSC's under their charge where the liability hasn't got a chance in hell of being recovered, so they (CKA and Boox) are in the firing line.

You need to get your appeals letter 100% correct and in time so maybe seek professional help if you are not with CKA, CKA does have very good conditional and appeals claims letters availabl for free.

Boox going away/trading under another name/whatever they have done, will not affect the appeals process or the MSCP process (the former may mean you get no help). They CK and Boox are not heading to tribunal the MSCs (you) are. So Boox not trading won't affect anything really other than the aforementioned inconvenience, from what I have heard though Boox have not been a lot of help so far.

No idea on anything else Boox related though I'm afraid.

I would possibly avoid approaching HMRC directly unless you have someone with you who can prevent you saying something potentially incriminating.

[Hareforthebear]

I dont see any info for this company that bought them other than the companies house records, where are you seeing them? Not that it really matters now.

I haven’t dug too deep as it’s irrelevant to me really but have a look at the people involved with limelight and you will see they are tied up with dozens of similar sounding ‘book-keeping’ and other companies, DNS Accountants is one that has a website. Doesn’t look like they are ICAEW registered at all and to be honest the directorships of the people on CH and the profiles of the companies involved just looks odd. Will leave it at that.

[Thehunter157]

Looking at the so called support page that Boox posted up yesterday, they mention QDOS tax advisers and David Kirk's group as potential contacts. I am already with David's group, can I assume that QDOS would provide pretty much the same service or should I be talking to them too?

It's absolutely chaos really, Boox have disappeared halfway through doing my company accounts, I've paid them to do my personal return but have heard nothing and now they are advising to put conditional claims in for personal tax but didn't before so I have no idea how to word it!

[JohnP1977]

I'm spending a bit of time this weekend trying to work out my potential liability to see if I can get to an answer without having to pay someone to do it for me and there's one question that keeps bugging me.

Everyone is referring to liability for the 17/18, 18/19 & 19/20 tax years but why aren't 20/21 and 21/22 in play from HMRC point of view? We only got notified at the beginning of 22 and surely nothing substantial has changed between 2020 & 2021?

[rdw1970]

Hey All,

I have since reached out to Boox (to no avail) but also to my insurers (who don't cover MSC) and also a speculative enquire to QDOS and David Kirk (yet to respond though this was only yesterday).

To the greater point, moving forward, do you think it would be wise to dissolve / close my LTD company now (if allowed) and start afresh, whether that be going FT, umbrella or creating a new LTD?

Regards

FYI David Kirk is currently away, back on 29th but may take some time to go through all the inquiries but he will respond eventually.

Unfortunately, you probably won't be able to close your company down as HMRC most likely has a flag on it and will object to its dissolution. There are a few ex-Boox clients on here in that position.

As others have mentioned on here, gather up as much evidence as you can that you set up and ran your own business yourself, made all the decisions re:- business bank account, clients, salary + dividends paid, any personal pension payments etc and had as little hand-holding from Boox as possible. It sounds like you already did do a lot yourself having a company website, email, logo, own invoices etc so gather up the evidence for this.

[rdw1970]

Everyone is referring to liability for the 17/18, 18/19 & 19/20 tax years but why aren't 20/21 and 21/22 in play from HMRC point of view? We only got notified at the beginning of 22 and surely nothing substantial has changed between 2020 & 2021?

They can go back 4 years so are in no rush and possibly don't have the resources to look at the most recent tax years either. The only positive I can think of (and there aren't many) is that this investigation has been going on for a while but they only managed to rush the determinations out at the last minute otherwise they could have gone back further than 2017\18 if they'd got their act together sooner.

[jamesbrown]

An average of 35% of profits (dividends only) have been taken from the company through the course of the 3 years (17,18,19) highlighted.

The first thing to note is that the MSC legislation does not apply when you've paid out less than or equal to 50% of the amounts invoiced ex VAT (including salary, dividends and expenses) over an extended period. You should check your figures, but if you're comfortably below 50%, then you should be in the clear.

Regarding whether you should attempt to close your company, no, HMRC will block this.

[pete1987]

The first thing to note is that the MSC legislation does not apply when you've paid out less than or equal to 50% of the amounts invoiced ex VAT (including salary, dividends and expenses) over an extended period. You should check your figures, but if you're comfortably below 50%, then you should be in the clear.

Regarding whether you should attempt to close your company, no, HMRC will block this.

Thanks. Yes, after adjusting the numbers which now include salary, dividends and expenses its looking at around 55-60% so looks like I don't have an 'out' on that clause.

[pete1987]

FYI David Kirk is currently away, back on 29th but may take some time to go through all the inquiries but he will respond eventually.

Unfortunately, you probably won't be able to close your company down as HMRC most likely has a flag on it and will object to its dissolution. There are a few ex-Boox clients on here in that position.

As others have mentioned on here, gather up as much evidence as you can that you set up and ran your own business yourself, made all the decisions re:- business bank account, clients, salary + dividends paid, any personal pension payments etc and had as little hand-holding from Boox as possible. It sounds like you already did do a lot yourself having a company website, email, logo, own invoices etc so gather up the evidence for this.

Thanks. Noted on David Kirk's availability.

Yep, in the process of pulling together any bits of evidence to help prove my innocence!!