Churchill Knight & Boox clients being investigated as Managed Service Companies

[enda1]

I think your interpretation is correct. For anyone that paid out a smaller fraction in salary/dividends, which is probably quite a few people, it should be a fairly straightforward task to demonstrate that 61B (1) (b) does not apply and hence the MSC legislation does not apply.

Regarding taxes owed - as I understand it, HMRC has not yet sent demands for ErNI and EeNI which is, of course, the main chunk of tax in question for any deemed payment scenario.

How do you think that would work for dual-director companies with 50/50 shareholder split you think?

[jamesbrown]

How do you think that would work for dual-director companies with 50/50 shareholder split you think?

You mean if the total amount distributed exceeded half of the total invoiced, but not if you considered each director separately? I assume it would meet the condition.

[Fred Bloggs]

David Kirk told me they can. WTT told me they can't. The HMRC handbook seems to say they can. The HMRC guidance notes seem to say they can't.

If you're saying pension contributions could be taxed under the MSC legislation, I think that would cause widespread uproar across the country. Even thinking about it has to be very big step way beyond the pale. I can't see it happening. Ever.

[jamesbrown]

In general, pension contributions are safe. However, I imagine there are some circumstances where they wouldn't be safe. For example, imagine if you were under investigation and tried to use a large pension payment to circumvent an impending liability, I don't imagine that would work. Ordinarily, though, they are safe.

[Fred Bloggs]

In general, pension contributions are safe. However, I imagine there are some circumstances where they wouldn't be safe. For example, imagine if you were under investigation and tried to use a large pension payment to circumvent an impending liability, I don't imagine that would work. Ordinarily, though, they are safe.

Agreed, but that's no different than any other money and is covered by all kinds of forestalling regulations. Such action definitely puts the money into play.

The very principle of pensions though is that a pension when paid is simply deferred salary. Taxed on the way out of the pension pot but not on the way in. Even this nasty, rapacious tax grabbing administration would be pilloried to high heaven for breaking that principle.

[Fred Bloggs]

I was referring to conditional claims and if Hector is saying all earnings for that tax year should be PAYE - could I claim tax relief on the payments made to my private pension as they were gross payments and did not receive tax relief. Would be mildly amusing if this investigation actually ended up costing Hector more in Corp Tax + Self Assessment rebates and Tax relief on pension payments!

In that case, deemed PAYE would be a calculation after pension contributions were subtracted. Company contributions of course, which are fully tax deductible.

[GregRickshaw]

Anyone else getting money back when filling in the conditional claims form! Thanks HMRC you now owe me £300!!

Oh happy days if we get found guilty.

[Guy Incognito]

Anyone else getting money back when filling in the conditional claims form! Thanks HMRC you now owe me £300!!

Oh happy days if we get found guilty.

Do they get to charge the ~3% interest for 4 years on their bit but only pay you the 0.5% on your reclaim?

Pretty sure that will wipe out the £300.

[jamesbrown]

Do they get to charge the ~3% interest for 4 years on their bit but only pay you the 0.5% on your reclaim?

Pretty sure that will wipe out the £300.

They still need to claim both sets of NI...

[CA100]

Has anyone who was\is with Boox received any details of conditional claims refunds? I've signed up with David Kirk anyway and he said he'll be dealing with these after he's got the urgent appeals in.

Finally got a response from Hector and they've received my appeal and will respond to me shortly. If anyone hasn't heard from them yet, do chase them up.

Boox have told me they're thinking of putting out a conditional claim letter for their clients to use next month, once the appeals are out the way.

It looks like we'll all miss the deadline for the corporation tax conditional claim in any case, as according to the David Kirk advisor it was end of April, although I'm not clear what exactly was driving the deadline. It's annoying, as that's one reason I wanted to sign up with the David Kirk group (which otherwise is very vague on what you get for your money), but they're prioritising appeals so aren't getting round to processing non-appeal people until next week.

I've not had confirmation of receipt of appeal back from HMRC yet. I've chased but Boox are saying it's not an issue - because the appeal has been emailed in time without triggering a message undeliverable email, it should be accepted.