Churchill Knight & Boox clients being investigated as Managed Service Companies

[gikap]

Yes i believe i got the same letter, this would have been addressed to you personally as you are a named person. You will also receive a letter addressed to your limited company similar to last year for both PAYE and NICs

I think this is it. I received today another, same letter addressed to company. However, it is another massive amount to pay on top of what i already am expected to pay personally based on Regulation 80 determination letters. It is twice as much. All added together, per year, it is roughly 80% of my company's yearly incomes. Is this even possible? Are all this amounts actually added together?

[jamesbrown]

Thanks for the reply but I don't think you quite understood me there. I don't mean I'm taking all the profits out of the business, I meant that HMRC have come to their figures via my turnover, not my profit, so vast amounts of that amount has been paid out to contractors, not myself

I see. In principle, payments to suppliers should not be taxed as income to you personally, assuming they are legitimate suppliers and not someone with whom you have a personal connection. As you allude to, the calculations at this stage are essentially "made up" and appear to be based on turnover, rather than payments made to the individual. It may be that HMRC has reached a different conclusion about what the legislation says regarding quantum, but I think the legislation (and, indeed, their own internal manuals, although they can and do ignore these) is quite clear that the amounts in question concern the payments made to the individual and not the turnover of your company.

[Thehunter157]

You're correct that you cannot rely on the figures at this stage. However, taking money out of the business offers no protection at all and may even make things worse, since the amounts in question relate to payments made to the individual in respect of the income received during the period under investigation. For example, making payments equal to the greater part of the income received could mean that your company now meets the basic criteria for being an MSC when it didn't previously. Regardless, there are extremely draconian transfer of debt provisions (to you, personally) in Chapter 9, so removing profits from the business offers no protection whatsoever.

Thanks for the reply but I don't think you quite understood me there. I don't mean I'm taking all the profits out of the business, I meant that HMRC have come to their figures via my turnover, not my profit, so vast amounts of that amount has been paid out to contractors, not myself

[RAA]

Letter i received from HMRC this year is nothing like last year's for 2017/18. It is just a notice about National Insurance contributions and statutory payments. No explanations, no period or which years are involved, does not even mention Boox. Almost no details unlike letter from last year. Single page and that is it. It vaguely mentions Managed Service Companies Regulations 2007 and states how much my company should pay in national insurance contributions. Does this amount include last year's amount? Do i have to pay both? Does it include all years? Is this the last i'll hear from HMRC? It mentions i can appeal but i am not sure what am i even appealing against.

I am not sure how to go about this. Did any one else get same letter?

Yes i believe i got the same letter, this would have been addressed to you personally as you are a named person. You will also receive a letter addressed to your limited company similar to last year for both PAYE and NICs

Can anyone share how they appealed or have used any templates to appeal against NIC calculation letters? Or if have used any expert to help with appeals. I am not sure waiting for Boox to help makes sense anymore.

There's a support page and email address to contact Boox with, I've emailed them and received a template. They took a couple days to respond

[jamesbrown]

So according to David Kirk's latest update, it seems that HMRC have come to their figures (roughly speaking) by taking a company's turnover, minus Corp Tax and demanding PAYE on that figure. In my case, a pretty sizeable percentage of my turn over is sub contractor costs (Not to mention materials and god knows what else). So am I right to assume that the figures they are quoting is complete bananas? However I have decided to take money out of the business surely they can only tax me on profit? And also, (in the event of losing) the interest I accrue will be based on the real figure when it is sorted out? Thanks for reading.

You're correct that you cannot rely on the figures at this stage. However, taking money out of the business offers no protection at all and may even make things worse, since the amounts in question relate to payments made to the individual in respect of the income received during the period under investigation. For example, making payments equal to the greater part of the income received could mean that your company now meets the basic criteria for being an MSC when it didn't previously. Regardless, there are extremely draconian transfer of debt provisions (to you, personally) in Chapter 9, so removing profits from the business offers no protection whatsoever.

[Thehunter157]

So according to David Kirk's latest update, it seems that HMRC have come to their figures (roughly speaking) by taking a company's turnover, minus Corp Tax and demanding PAYE on that figure. In my case, a pretty sizeable percentage of my turn over is sub contractor costs (Not to mention materials and god knows what else). So am I right to assume that the figures they are quoting is complete bananas? However I have decided to take money out of the business surely they can only tax me on profit? And also, (in the event of losing) the interest I accrue will be based on the real figure when it is sorted out? Thanks for reading.

[Lotok]

Can anyone share how they appealed or have used any templates to appeal against NIC calculation letters? Or if have used any expert to help with appeals. I am not sure waiting for Boox to help makes sense anymore.

Boox doesn't exist anymore, so that would be a long wait. I am part of the David Kirk group and he appealed on my behalf so I don't have a template for you, just wanted to say 100% dont wait for Boox.

[gikap]

Can anyone share how they appealed or have used any templates to appeal against NIC calculation letters? Or if have used any expert to help with appeals. I am not sure waiting for Boox to help makes sense anymore.

[gikap]

Letter i received from HMRC this year is nothing like last year's for 2017/18. It is just a notice about National Insurance contributions and statutory payments. No explanations, no period or which years are involved, does not even mention Boox. Almost no details unlike letter from last year. Single page and that is it. It vaguely mentions Managed Service Companies Regulations 2007 and states how much my company should pay in national insurance contributions. Does this amount include last year's amount? Do i have to pay both? Does it include all years? Is this the last i'll hear from HMRC? It mentions i can appeal but i am not sure what am i even appealing against.

I am not sure how to go about this. Did any one else get same letter?

[DealorNoDeal]

They wouldn't and I contend that this almost certainly hasn't happened because HMRC would block automatically. These are the cases where it may appear to those involved that their company was closed, but it wasn't, in fact.

^This^

If someone really has managed to close their company, since the investigation started, it's probably just luck that it slipped through HMRC's net.