Churchill Knight & Boox clients being investigated as Managed Service Companies

[cjb2023]

Ive submitted further appeal 12 Feb 2023 stating that I left CK 30/5/18 and have the formal resignation letter from them. Also spoke with CK via appeals and they also said they have notified revenue of this fact and I should be subject to the MSC rules as I went independent from this point on. See what revenue say...

Typo - shouldn't be subject to MSC rules!

[Wookie Arms]

Former CK client also being fingered. First post, probably should have been here years ago.

In my case they’ve demanded payment for multiple years, and using back-of-napkin maths it looks like they’ve just made PAYE/NI demands on my company’s gross income resulting in an absurd total.

I disagree with being labelled an MSC, and am appalled at how HMRC have behaved over this (sitting on a letter for a week of the 30 day appeal period before posting it). However I left CK at the start of one of the tax years being claimed, so surely the demand wouldn’t apply once my business was transferred to another accountant?

If the period of exposure can be agreed as “while a customer of CK” and corporation, dividend and income taxes already paid will enter into the equation, I am inclined to just pay and call it an expensive lesson learned, as my company has the funds to do it, and the HMRC letter does admit that payments made are not an admission of guilt, and would be returned if they eventually lose against CK.

Am I being hopelessly naive?

[Guy Incognito]

Former CK client also being fingered. First post, probably should have been here years ago.

In my case they’ve demanded payment for multiple years, and using back-of-napkin maths it looks like they’ve just made PAYE/NI demands on my company’s gross income resulting in an absurd total.

I disagree with being labelled an MSC, and am appalled at how HMRC have behaved over this (sitting on a letter for a week of the 30 day appeal period before posting it). However I left CK at the start of one of the tax years being claimed, so surely the demand wouldn’t apply once my business was transferred to another accountant?

If the period of exposure can be agreed as “while a customer of CK” and corporation, dividend and income taxes already paid will enter into the equation, I am inclined to just pay and call it an expensive lesson learned, as my company has the funds to do it, and the HMRC letter does admit that payments made are not an admission of guilt, and would be returned if they eventually lose against CK.

Am I being hopelessly naive?

You can pay on account.

HMRC are not obligated to and don't seem inclined to do anything except stand you over and ignore you until the test cases have gone through the courts. So you won't have any kind of closure really.

[Fred Bloggs]

You can pay on account.

HMRC are not obligated to and don't seem inclined to do anything except stand you over and ignore you until the test cases have gone through the courts. So you won't have any kind of closure really.

The only complete closure available presently would be as the poster says and pay. I'd be tempted to pay on account and prepare my own portfolio of evidence against being an MSC ready to present at FTT. If it's ever required.

[GregRickshaw]

I am inclined to just pay and call it an expensive lesson learned, as my company has the funds to do it, and the HMRC letter does admit that payments made are not an admission of guilt, and would be returned if they eventually lose against CK.

Am I being hopelessly naive?

Do they say the payments would be returned (if paid to them ie settled)? Not if paid on account?

I am 99% sure if you pay/settle that's it a very expensive lesson and completely over and money gone forever.

However, if you pay on account (and you seem to have the wherewith-all) your money will only go to HMRC when they win. PoA (if you can afford it, most can't) is the best way. Make sure you call them with your K-reference so they ring fence the money for this debt.

[DealorNoDeal]

I am 99% sure if you pay/settle that's it a very expensive lesson and completely over and money gone forever.

Settlement is almost always final and irrevocable. It wouldn't matter if HMRC went on to lose the test cases. It would be virtually impossible to undo what is a contractual settlement.

Will they even let you settle at the moment?

[Guy Incognito]

They will let you pay the exact amounts in the determinations.

I do wonder if they had somehow made mistake and the numbers were too low they couldn't come back for more.

You can't settle by doing a deal like they did for the loan charge.

POA is the only rational thing if you do plan on paying.

[GregRickshaw]

Settlement is almost always final and irrevocable. It wouldn't matter if HMRC went on to lose the test cases. It would be virtually impossible to undo what is a contractual settlement.

Will they even let you settle at the moment?

They will let you pay the amounts, I was saying to the poster they might have misread they get their money back if HMRC go on to lose. I think they may have just got poA and pay the bill mixed up. PoA means money back (allegedly still not got mine) pay/settle means gone forever.

[eek]

Worth posting this https://www.contractoruk.com/news/00...is_clarke.html

Even though I think it's clear for anyone who reads the first few pages of this thread where HMRC's issues were - running an app that made doing suggested things very easy is problematic.

[jamesbrown]

Worth posting this https://www.contractoruk.com/news/00...is_clarke.html

Even though I think it's clear for anyone who reads the first few pages of this thread where HMRC's issues were - running an app that made doing suggested things very easy is problematic.

The owner of an accounting firm actually said this:

Significantly, these codes were agreed with HMRC on the basis that compliance with the code was a clear indication that the company was not a MSCP.