Churchill Knight & Boox clients being investigated as Managed Service Companies

[mno]

I asked DK about helping me with POA amount as I'm not sure how much I should be paying, he is too busy unfortunately. Is there anyone else who is able to assist us with this?

You should have received the letters in post about tax due ? If not, CK have sent everyone these letters from HMRC showing PAYE and NI due.

[mno]

You must appeal. If you do not appeal with the 30 day window you legally owe the money regardless of anything that happens in court in the future.

Thank you for your reply. As of yesterday, I have sent the template reply using the appeal portal from CK via email. Hopefully that has been recorded at the other end.

[mno]

Thank you Greg.

My understanding is that the PoA /tax due is meant to be paid in 30 days (from the date of determination notices?). Is this correct as I have not seen any dates on notice letters pointing to when to pay by. I have only seen this in CKs Faq's section that tax due is expected to be paid within 30 days of the notice.

In addition, since now I have sent the appeal and 30 days are (almost) over can I now pay even a bit after (would this mean interest charged for any days after 30 days period) when I pay.

Also, there is an element of tax reclaims for corporation and dividend tax. There are again some reclaim letters for which CK is providing some templates but should one just send them anyway for the periods just to be on the safe side ?

HMRC is happy to charge interest if tax dues are not paid in time but does is pay interest back to you if they lose for PoA amounts ?!

Also, having caught up in MSC mess - would this trouble any future contract roles or better not to look for any. Is there a vote for local accountants or still safer way of Umbrella PAYE ?

Considering HMRC is going to find one way or another of clawing back monies I am not sure how safe any of these other methods are.

[7specialgems]

Have had a read of https://www.gov.uk/hmrc-internal-man...manual/esm3520 with particular interest in the the following excerpts:

* The definition of the "fourth activity"
* The disclosure that "being the company secretary of client companies constitutes being involved in all cases"

This has got me looking at the following two line items on NW's Gold Package list with some side eye:

* Filing Confirmation Statements
* "All company administration (change of address, share changes and board minutes)"

[Hareforthebear]

Have had a read of https://www.gov.uk/hmrc-internal-man...manual/esm3520 with particular interest in the the following excerpts:

* The definition of the "fourth activity"
* The disclosure that "being the company secretary of client companies constitutes being involved in all cases"

This has got me looking at the following two line items on NW's Gold Package list with some side eye:

* Filing Confirmation Statements
* "All company administration (change of address, share changes and board minutes)"

Has all the language around ‘tailored’ and ‘standardised product’ been added recently? I don’t recall seeing this before but maybe I just didn’t actually see this before. Seems pretty clear they are going to argue ‘standardised product’. As there’s no way boox is ‘involved’ with my company from their own guidelines there unless it’s under the ‘standardised product’ caveat.

Is there anything in the legislation or case law that backs up this approach? Or is this what they are trying to get into the case law to remove the ‘accountancy exemption’?

If so where do you draw the line at a standardised product, seems very subjective.

If part of your client base has similar almost identical needs then obviously they would be provided similar almost identical services.

Their guidance here now seems to state the fee charged only constitutes involved if it’s linked to provision of services so maybe this point will be withdrawn in cases where they’ve said ‘you paid them therefore this criteria is met’

[eek]

Has all the language around ‘tailored’ and ‘standardised product’ been added recently?

Internet Archive has the exact same wording in 2019 so nope. https://web.archive.org/web/20190725...manual/esm3520

[Hareforthebear]

Internet Archive has the exact same wording in 2019 so nope.

Ah ok cheers

[eek]

I posted this elsewhere on Friday but given the current conversation it's probably worth repeating it here

It's also probably worth posting what I suspect is HMRC's naive view of how IR35 works.

Company decides to save money / ensure their staff get more by taking them on via a PSC. To do that they use agencies who suggest you create a limited company because it gives you more money and is less hassle for them. The contractor asks how should I do that and the agency provides a list of FCSA accountancy firms selling packaged solutions that pay the agency a commission for every customer referred to them.

Which is why the Chapter 9 MSC legislation is being used here because HMRC suspect that if it wasn't for the accountancy firms these people would be being paid via PAYE and so want it to be done that way.

The bit in bold I've added here to make things 100% clear but I think it explains what is happening.

My current curiosity is which other accountancy firms will be getting letters in March?

[Fuzzynavel]

Relying on ITEPA 2003 Ch9 61B(3) won't help. If they decide they are 'involved' it doesn't matter if they are accountants or not.

On what grounds can they say that my company is involved with Boox without a shred of evidence?

I have sent a written appeal to them showing my independence as a company... for example
1. My Ltd company was incorporated before first contact
2. I had my VAT registration done
3. I had a consulting contract in place
4. I had bank accounts in place
5. I have received accountancy advice from Boox and then decided not to follow it
6. I refused to connect my bank account to their platform.
7. I refused to change the registered address of my company to register at Boox

I did use the "MyBoox" platform but that is no different to having Quickbooks or Xero provided free by an accountant and them having backend access to my numbers. It's a value adder.

There is absolutely no way that HMRC can prove a link that was any more than Client:Accountant in my case.

If the MSC legislation was developed to stop accountants providing "Cookie Cutter" company set ups then that is fine but they should at least look at the engagement details of each individual case. The fact that they do not have the resources to do this cannot validate their fraudulent claims.

They seem to be taking the "bill first and deal with the fallout later" approach because they know they have bottomless pockets and we can't afford to fight them in court.

[eek]

On what grounds can they say that my company is involved with Boox without a shred of evidence?

I have sent a written appeal to them showing my independence as a company... for example
1. My Ltd company was incorporated before first contact
2. I had my VAT registration done
3. I had a consulting contract in place
4. I had bank accounts in place
5. I have received accountancy advice from Boox and then decided not to follow it
6. I refused to connect my bank account to their platform.
7. I refused to change the registered address of my company to register at Boox

I did use the "MyBoox" platform but that is no different to having Quickbooks or Xero provided free by an accountant and them having backend access to my numbers. It's a value adder.

There is absolutely no way that HMRC can prove a link that was any more than Client:Accountant in my case.

If the MSC legislation was developed to stop accountants providing "Cookie Cutter" company set ups then that is fine but they should at least look at the engagement details of each individual case. The fact that they do not have the resources to do this cannot validate their fraudulent claims.

They seem to be taking the "bill first and deal with the fallout later" approach because they know they have bottomless pockets and we can't afford to fight them in court.

Read my post above.

HMRC's viewpoint is that Boox provided a packaged solution that targeted people who would otherwise have been paid via PAYE.

That is enough for them to be a MSC provider in HMRC eyes - it is now up to the tribunals to determine otherwise.

Edit to add - and the whole point of the MSC legislation was to avoid the need for HMRC to look at every individual case - it's very much you are guilty by association until you prove you aren't.