Churchill Knight & Boox clients being investigated as Managed Service Companies

[Sijo]

Yeah, there are timelines for making adjustments w/r to each tax, different timeframes for different taxes, but these are invariably exceeded with any tribunal scenario and you can guess HMRC's position (but the advantage of a tribunal is that the judge can be asked to rule when there is no agreement between parties about the quantum and they have latitude to impose something fair). For CT, it's four years since the end of the accounting year.

Thanks. My company account year end is Aug. So for 2017-18 tax affairs, I guess I have time till this August. That's bit of a relief.

[eek]

Right. But on the upside, HMRC's case looks really quite weak at this stage, even after factoring in some of the terrible marketing from CK and Boox and even after factoring in the dormant company rate at CK, which has a commercial reason. As WTT noted, HMRC have a complete blind spot for commercial decisions, but they are real/applicable.

Looking at it from HMRC's side of things - you have a massive extension of what is caught under the MSC legislation, bosses (at various levels) wanting to "recover" a large amount of "avoided" tax and some examples that may be easier to argue than the far worse examples we've seen posted on LinkedIn.

So I can see why they are going after Box and CK because their portals seemingly give them attack points that aren't available elsewhere.

Got to say that Freeagent and one off fees as you pay for your accountant to do the tasks you want done does seem to be the only sane approach going forward.

[GregRickshaw]

You'd lose...

Actually you are right, it is a futile move and one if it fails likely to bring even more heat.

[GregRickshaw]

No, but what if they decide (possibly correctly) that the debtor is unable to pay because they diverted their assets elsewhere to put them out of reach...?

GAAR covers a lot of ground.

Possibly in that case, but not if I throw myself off a car park before then.

[superdoodle]

If anyone wants to join a WhatsApp or Facebook group, please DM me.

I think we're all gathering thoughts and a defence separately. We may also be able to help each other, even if it means joining up with another group that's forming.

[neneh]

I am a newbie and uses NW as PSC since 2017. Apart from paying a monthly fee and being recommended a yearly salary option, i do everything on my own ie submit my own expenses, raise and chase of payment of invoices, decide on dividend payments. NW file my VAT, PAYE and Annual Return and the yearly accounts which is typically what a normal accountant will help do. I struggle to understand how all these arrangements fall under MSC legislation. I believe all PSC providers follow very similar arrangements as above. So if CK is not doing something right, this applies to all.

I was burnt badly in the EBT loan scheme few years ago and hence the switch to PSC. Never in my mind that this is now subject to HMRC attack as well. One thing that bewilders me that if PSC falls foul of the law, surely this should have been raised by HMRC long ago. Not years later. Its like driving 30mph on a 20mph road everyday with no sign and no penalty to receive a fine 10 years later to fine you for everyday you drove above 20mph.

[GregRickshaw]

I am a newbie and uses NW as PSC since 2017. Apart from paying a monthly fee and being recommended a yearly salary option, i do everything on my own ie submit my own expenses, raise and chase of payment of invoices, decide on dividend payments. NW file my VAT, PAYE and Annual Return and the yearly accounts which is typically what a normal accountant will help do. I struggle to understand how all these arrangements fall under MSC legislation. I believe all PSC providers follow very similar arrangements as above. So if CK is not doing something right, this applies to all.

I was burnt badly in the EBT loan scheme few years ago and hence the switch to PSC. Never in my mind that this is now subject to HMRC attack as well. One thing that bewilders me that if PSC falls foul of the law, surely this should have been raised by HMRC long ago. Not years later. Its like driving 30mph on a 20mph road everyday with no sign and no penalty to receive a fine 10 years later to fine you for everyday you drove above 20mph.

The speed limit thing was my analogy too after the Loan schemes. Ironically I was forced to be a PSC (Ltd) so I did the 'right thing' so I needed an accountant for my 'books' and now here we are.

If it weren't so tragic the irony would be hilarious.

[Fred Bloggs]

I am a newbie and uses NW as PSC since 2017.

There's no indication that NW are being targeted for MSC investigation, is there? Prepare for the worst, hope for the best and get on with your life, I suggest.

[eek]

There's no indication that NW are being targeted for MSC investigation, is there? Prepare for the worst, hope for the best and get on with your life, I suggest.

+1 - if HMRC had any real evidence against NW or other firms they would have issued letters before April 6th. By not doing so they've lost potential £x0ms because they can no longer chase tax from 2017/18. I doubt they would have done if they had had anything they could work with.

[mudskipper]

There's no indication that NW are being targeted for MSC investigation, is there? Prepare for the worst, hope for the best and get on with your life, I suggest.

Agreed. I think everyone who uses a "contractor accountant" is keeping a cautious eye on things, but at this stage I'm not unduly worried. I'm happy with my accountant (Maslins) and certainly have no intention of a knee-jerk reaction. Years ago I did have an accountant who had their own portal, but pretty sure that was before 17/18. I did check recently and they still have their own portal, but I've not seen any posts about them so assume their customers are OK!