Churchill Knight & Boox clients being investigated as Managed Service Companies

[DealorNoDeal]

...if CK are found guilty of creating us as MSC...

I think you've kind of got that the wrong way round. HMRC won't be taking CK to a tribunal to prove they're an MSCP. They will be taking clients to tribunal to prove they are MSCs (from which it follows that CK is an MSCP).

But it will only ever get to tribunal, if some clients are willing to take on HMRC.

[superdoodle]

In which case, I'm struggling to see how this ever gets to tribunal. For a decent tax barrister, you're looking at £100k to take a case to the FTT.

Did you previously say that HMRC have identified CK clients to take to the FTT as test/lead cases? How the hell are they going to afford representation?

With the CBS case, my guess is most clients folded (settled), and it was just a handful of brave (foolhardy) souls who took it to the FTT/UT/CoA.

Yes but some of us have legal/professional fees covered under QDOS that we should be able to claim so I imagine there could be a banding together of PSCs to fight this.

Also check under your prof indemnity cover. I just checked my Kingsbridge prof indemnity and am also covered for legal fees there. Contacting them now for advice.

[difficulttimes]

I think you've kind of got that the wrong way round. HMRC won't be taking CK to a tribunal to prove they're an MSCP. They will be taking clients to tribunal to prove they are MSCs (from which it follows that CK is an MSCP).

But it will only ever get to tribunal, if some clients are willing to take on HMRC.

All they will need is a couple of lead cases and the rest of them would be linked to them. I'm not sure how many clients but if there are 1k then there would have to be some kind of association where you contribute towards it. I think you are talking about some hefty sums and if you settle for one year then you have opened yourself up for future years. For most fighting may only be the option. I see WTT are holding a webinar about it on Thursday so I'm sure they and others will be looking at setting something up.

[GregRickshaw]

I think you've kind of got that the wrong way round. HMRC won't be taking CK to a tribunal to prove they're an MSCP. They will be taking clients to tribunal to prove they are MSCs (from which it follows that CK is an MSCP).

But it will only ever get to tribunal, if some clients are willing to take on HMRC.

True my vernacular is wrong with the word 'guilty' which sounds as though CK will be in court. Apologies but I have said many times it is 'us' who have been accused.

I have resigned myself to it being all the years so paying on account will continue long after 17/18 has been 'paid', as will the case it seems, between 10 and three years is being thrown out there as possible length.

Yes I hear this about these group action thing going on about setting something up, which of course won't be free which will drag on for years (allegedly) costing us xx amount to join and xx amount per month and xx extra to do this that an the other.

All of which means some more of those never ending groups will get rich on the back of all of this and we will be double punched in the face when Hector wins in 10 years time or next time ...

[DealorNoDeal]

Yes but some of us have legal/professional fees covered under QDOS that we should be able to claim so I imagine there could be a banding together of PSCs to fight this.

Also check under your prof indemnity cover. I just checked my Kingsbridge prof indemnity and am also covered for legal fees there. Contacting them now for advice.

Check if it covers more than just IR35 investigations.

[Hareforthebear]

This is likely to lose CK and Boox a lot of business. Can they survive this

Boox have already started a rebranding by the looks… ‘Square Accounting’ is another trading name of the legal entity that is trading as Boox. From their website looks like started last year, too much of a coincidence surely.

I’m not sure of the exact road-map from here but it is definitely in Boox’s interest to have this cancelled, so hard to see them leaving their client’s out in the cold entirely. If they have hundreds of clients this has been issued to, then there is a very real chance it is not just 1 or 2 of these that may go up the chain with the debt transfer.

If I’m not mistaken it was mentioned in the CBS case that they had paid for the legal representation, not saying that will happen here, but Boox/CK and the end clients are potentially on the hook for ALL of this (obviously won’t happen like that but theoretically possible).

From HMRC’s Letter, they are still ‘fact finding’ with Boox, so it is pretty poor that these have even been sent where they are not 100% sure of their stance (not surprising obviously but ridiculous nonetheless).

The more I read their rationale the angrier it makes me.. Especially the paragraph about condition a where they actually appear to refute their own argument.

[eldy]

QDOS have told me "with both the Tax Enquiry Insurance and Tax Liability Cover, MSC enquiries are an exclusion of the policies."

[superdoodle]

QDOS have told me "with both the Tax Enquiry Insurance and Tax Liability Cover, MSC enquiries are an exclusion of the policies."

Have they sent you the small print that sets this out? I had a look through the policy wording the other day and couldn't see anything to this effect. I know they don't cover the tax liability for MSC but nothing in the tax enquiry section.

[jamesbrown]

QDOS have told me "with both the Tax Enquiry Insurance and Tax Liability Cover, MSC enquiries are an exclusion of the policies."

Probably time to cancel your Qdos policy, at least on the former (tax liability cover has never been worth the paper it was written on). It's ironic because there are historic posts from Qdos alluding to their positively wanting to demonstrate the value of their product, but I guess the MSC legislation creates some systemic risks.

[Fred Bloggs]

QDOS have told me "with both the Tax Enquiry Insurance and Tax Liability Cover, MSC enquiries are an exclusion of the policies."

Is it actually written in the (very) small print? What an awful turn of events on top of everything that's happening.