Churchill Knight & Boox clients being investigated as Managed Service Companies

[cojak]

It’s almost as if they didn’t expect people to Google and find out how to respond to these demands…

Ok Greg. This looks like a subset of ‘In Business on Your Own Account’.

While CK are looking like they’ve got questions to answer, it looks as if you have solid answers to those questions.

So organise your folder with EVERYTHING that shows that you are a businessman. Dig out all correspondence for organising your Ltd, Vat and everything else (digital and paper) that shows that you set up and run the LTd on your own. Also demonstrate that you make all the financial decisions for your company. Make sure that those answers are given to your tax advisor and your MP.

Here are tips to show that you are outside IR35: https://www.contractoruk.com/private...side_ir35.html

And remember to put all of this evidence into your appeal to HMRC - you have 30 days from the date of the letter to return it.

View this as a form of IR35 investigation - HMRC are wrong in your circumstances and a good defence will get you out of this.

[malvolio]

Isn't it just incredible? They clearly hoped that being in receipt of the dreaded brown HMRC branded envelope and determination letter would be enough to frighten a few individuals into paying up without causing any fuss and now they're 'shocked' to find out otherwise. I thought HMRC had a duty of care to taxpayers yet they sent these determinations out based on best judgment (their words) and before completing their own fact-finding first! Completely irresponsible of Hector.

HMRC absolutely do not have a duty of care to their "customers". They have bankrupted perfectly healthy companies by cocking up the company name before now, with no impact to themselves...

[eek]

FFS. They really are fecking hopeless, aren’t they?

Nope - HMRC don't care - their task was getting letters out in time. With that job done dealing with the responses can take a backseat...

[GregRickshaw]

Just watched the IPSE webinar. I just don't see how I can possibly lose. The HMRC case is just so flawed.

We can absolutely lose. This is what concerns me most, everyone (it seems) thinks we can't lose. Prepare yourself as if you we can lose, get everything ready for a long fight, this eventually will boil down to you and your company not CKA or Boox (they're going to jail or bankruptcy or both), which will leave us fighting this with help or on our own.

Just be sure to have everything you have to prove you were not an MSC. I am still compiling things 3 months and still finding good stuff.
I found a bunch of business cards recently I had forgotten about (just a few but the receipt to the printers in my company's name etc.,) you probably have a gold mine of stuff.

[GregRickshaw]

If the courts find CKA and Boox guilty as MSCP then we are in for a tough fight sure. From recent correspondence with CKA it seems HMRC want to chose 5 cases to take to tribunal, and if they win there then they (HMRC) could argue the case for all to be found guilty of being MSC. However, if they lose then they may drop the whole thing or not (who can tell). From what I can tell CK are going to let HMRC choose but they (CK) will then say this is a bad idea (case by case) to go or not (odd comment really when they - CK- deny any wrong doing from the start!)

Those who get chosen will then fight on their own (on their own remember no help no funding for QCs from CK or Boox) so a this point you would hope the five chose are all members of a group to share cost. I think the groups may be able to offer up cases on their own not sure.

I heard David say this too and do you want another HMRC inspector looking at another HMRC inspector's work? How does that go do you think? Do you trust them the higher inspector or the courts? In this case I trust no one really, not even the groups helping. They'll get their big fat pay day not matter what.

[GregRickshaw]

[/QUOTE]

The only thing I'm clinging to is this paragraph in the determination which shows HMRC are not 100% certain Boox are an MSCP (I dont know if this is also in CK Reg 80 letters) "The amount of the determination has been calculated using 'best judgment' based on information held and this may change as more facts and information are gathered. Should the fact finding process show the MSC Legislation does not apply, the determination will be reduced to nil" I just hope these meetings Boox and their legal team supposedly have arranged with Hector manage to convince them that they're wrong on this and the case is dropped. I'm probably living in dreamland though.

David Kirk said they will select the best 5-7 cases and get them to the tribunal first (I can't remember why they need to get them in before Hectors cases) and he seemed confident Boox will stump up the cash to pay for a Barrister. Whether this is true remains to be seen otherwise the other members will need to all chip in.

Agree I can't see a senior HMRC officer overruling a case like this which potentially has huge ramifications in the contracting arena but then what do I know?

Yeah that is the only thing I am not understanding about David, he said Ck would help with costs too yet CK have said quite emphatically they won't. Which is a good thing and a bad thing too. Good because do you really want your supposed MSCP funding your case?! That kind of looks a bit iffy.

CK and Boox cannot prove HMRC are wrong at a top level all because of point A. This is the huge fight and we hope and pray exemptions (accountancy etc.,) apply.

CK and Boox are not on trial (yet) we are it's our companies who have the debt and the charges applied to us not CK and Boox. CK and Boox let's be clear here are only involved because of debt transfer possibilities, if there was no debt transfer outside the directors of the PSC then they would not even give a stuff.

I really do hope when all of this is over both of those companies go bankrupt and their directors too. THEY KNEW about this THREE (possibly more) YEARS AGO, yet they never said a word. You can thank them when 18/19, 20/21, 21/22 letters come bouncing in!

[GregRickshaw]

David Kirk said they will select the best 5-7 cases and get them to the tribunal first (I can't remember why they need to get them in before Hectors cases) and he seemed confident Boox will stump up the cash to pay for a Barrister. Whether this is true remains to be seen otherwise the other members will need to all chip in.

I think... he means the obvious errors there are some who weren't even with CK in the year they have had a letter before etc., I could be wrong and those cases have already been thrown out, but I haven't heard this as yet.

[jamesbrown]

we hope and pray exemptions (accountancy etc.,) apply.

Paul Mason made a valid point in a recent IPSE seminar that the wording of 61B(3) is not an exemption, rather a presumption that the mere provision of legal or accountancy services in a professional capacity is not automatically caught. This is a less favourable interpretation, of course, but no doubt correct when the words are parsed literally.

A person does not fall within subsection (1)(d) merely by virtue of providing legal or accountancy services in a professional capacity.

As an side, I expect the motivation for CK and Boox to defend this is not primarily a concern about transfer of debt (since it transfers to the MSC and other involved individuals first), more likely the existential threat to their business model. Or, at least, the combination of those two things.

[rdw1970]

As an side, I expect the motivation for CK and Boox to defend this is not primarily a concern about transfer of debt (since it transfers to the MSC and other involved individuals first), more likely the existential threat to their business model. Or, at least, the combination of those two things.

Yes and this is precisely why Boox kept shtum about the investigation and had a fairly carefree tone about it when I asked them wtf was going on.

[GregRickshaw]

Paul Mason made a valid point in a recent IPSE seminar that the wording of 61B(3) is not an exemption, rather a presumption that the mere provision of legal or accountancy services in a professional capacity is not automatically caught. This is a less favourable interpretation, of course, but no doubt correct when the words are parsed literally


As an side, I expect the motivation for CK and Boox to defend this is not primarily a concern about transfer of debt (since it transfers to the MSC and other involved individuals first), more likely the existential threat to their business model. Or, at least, the combination of those two things.

Indeed and CK fall further into a trap on fees as they were one of those companies who 'became accountants' at least Boox have chartered accountants in their business name/model.


As an side, I expect the motivation for CK and Boox to defend this is not primarily a concern about transfer of debt (since it transfers to the MSC and other involved individuals first), more likely the existential threat to their business model. Or, at least, the combination of those two things.

I agree their primary concern will be holding onto their very lives, but there are going to be a lot of companies in the 1000s captured who will have vanished off the face of the earth, untraceable to even apply the debt too (even with the huge caveats HMRC have) there will be some considerable sums which will end up in CK's lap (and I will be glad if it does - their behaviour in not alerting us in unforgiveable).