Churchill Knight & Boox clients being investigated as Managed Service Companies

[Bruce88]

The other way, I have read on here and there are some very good details responses on this post, is to pay less the 50% of your income out of your company, that is horribly paraphrased so have a search through this forum and this post for the better detail.

This is the argument that I am now having with the HMRC.

My personal income taken from my limited company is significantly below 50% of turnover. However the HMRC have stated that they believe employer pension contributions constitute indirect payments to the individual, which conveniently for them takes me just over the 50% threshold. This I strongly disagree with, as contributions are made directly from the business account to an approved pension scheme and held by the trustees of the scheme until such time as I retire. At that point a payment is made to the individual which the HMRC recognise as this is when the appropriate tax is applied.

It seems to me to be another case of the HMRC applying their own interpretation to legislation.

[jamesbrown]

I've been trying to get mine thrown out on this basis since it all started and HMRC are just ignoring the argument and refusing to engage

TBF, these are probably going to be the last ones to get thrown out because it will need to be evidenced and the calculation may be disputed, but the legislation is nevertheless clear about the qualifying conditions for being an MSC, of which this is one.

[antuk]

The other way, I have read on here and there are some very good details responses on this post, is to pay less the 50% of your income out of your company, that is horribly paraphrased so have a search through this forum and this post for the better detail.

I've been trying to get mine thrown out on this basis since it all started and HMRC are just ignoring the argument and refusing to engage

[jamesbrown]

I expect some of those that they're getting around to eliminating now we not actually clients of CK or Boox during the tax years in question, but were on their books in earlier or later years. Remember, all these Reg 80 determinations were rushed out to meet a deadline and it's easier for HMRC to capture absolutely everyone with even the slightest chance of a potential liability, initially, and then to de-blunder later.

[cojak]

Not overreached as such (certainly not with Boox it appears), but I think that they thought that it was an easier fish to land than it turns out to be, and they need to refine their attack in order to win it.

[s684]

Any idea when the tribunal hearing might be? It should be an interesting one to follow.

I can't help thinking HMRC have overreached with this. Fingers crossed.

[GregRickshaw]

The companies that have been removed... do you know anything about them? Just trying to find out what makes HMRC consider what companies are still MSCs.

In my case 17/18 & 18/19 were removed (I believe) because my company was a full on a consultancy, I had up to five employees (including me) at one point.

Hoping now though HMRC are removing not so obvious ones from the list, we don't have any details as yet though.

What HMRC are trying to get at are the LTDs which were in essence just tax avoidance which I suspect 99% of contractors use their LTDs for.

The other way, I have read on here and there are some very good details responses on this post, is to pay less the 50% of your income out of your company, that is horribly paraphrased so have a search through this forum and this post for the better detail.


BTW still haven't had my PoA money back yet

[ritwolf]

So we had the update today July 14th and it wasn't the BIG one but it seems even more companies (CK clients obviously) have been removed from the investigations.

A good sign I believe, as those of us who were removed early on who were obviously not MSCs are now being joined by others who may have not been so obvious when this all began a good sign or a honing in on the obvious targets to ensure victory? Is that the cynic in me?

I'm sticking with the good sign and being positive

The companies that have been removed... do you know anything about them? Just trying to find out what makes HMRC consider what companies are still MSCs.

[jamesbrown]

I think it's both. It's a good (inevitable?) sign because they're admitting that not all of the alleged MSCs are, in fact, MSCs, so they won't be able to treat everyone the same, but we also kinda knew that. I agree that they will be looking for the weakest links and to continue incrementing tribunal/court decisions in their favour, creating new case law if it reaches UTTT or higher.

[GregRickshaw]

So we had the update today July 14th and it wasn't the BIG one but it seems even more companies (CK clients obviously) have been removed from the investigations.

A good sign I believe, as those of us who were removed early on who were obviously not MSCs are now being joined by others who may have not been so obvious when this all began a good sign or a honing in on the obvious targets to ensure victory? Is that the cynic in me?

I'm sticking with the good sign and being positive