Churchill Knight & Boox clients being investigated as Managed Service Companies

[eek]

The CBS decision became final on 3 Dec 2019 when the Supreme Court refused permission to appeal, although HMRC would have been highly confident of victory long before then.

https://www.gov.uk/government/public...-contributions

It looks like it took HMRC over 2 years after that before launching a full-on attack against CK/Boox, so maybe it was far from obvious.

For those affected by this, my hope is that HMRC are chancing their arm, seeing how far they can push it. Sadly though I have little faith in the tribunals/courts who seem all too willing to do HMRC's bidding.

For someone who claims to know how HMRC actually works - you haven't got a clue how HMRC actually works...

[GregRickshaw]

The CBS decision became final on 3 Dec 2019 when the Supreme Court refused permission to appeal, although HMRC would have been highly confident of victory long before then.

https://www.gov.uk/government/public...-contributions

It looks like it took HMRC over 2 years after that before launching a full-on attack against CK/Boox, so maybe it was far from obvious.

For those affected by this, my hope is that HMRC are chancing their arm, seeing how far they can push it. Sadly though I have little faith in the tribunals/courts who seem all too willing to do HMRC's bidding.

HMRC started their investigations into CK and Boox long before 2021 and possibly even before 2019.

I suspected HMRC looked at CK (looked meaning actually opened the investigation) as early as 2012, I have said many times on here early 2012 was when CK without warning changed everything they had done previously almost overnight.

CK could never have been considered hands on in any way, but from 2012 there was a sense of 'you are on your own and we'll take care of your annual returns', which suited many of us as that is exactly what happened anyway, yet here we still are.

Though I suspect their packaged products (and the vernacular around them) and their monthly fees will be the undoing of CK - possibly.

[Snooky]

For someone who claims to know how HMRC actually works - you haven't got a clue how HMRC actually works...

Why the need to be so rude? A constructive response might add far more to the discussion, especially for those of us following who definitely don't have a clue how HMRC works

[s684]

For someone who claims to know how HMRC actually works - you haven't got a clue how HMRC actually works...

Having been on the receiving end of HMRC's actions/behaviour for 19 years, I have first-hand experience of exactly how HMRC operate.

They expect "customers" to be open, honest and transparent and yet they are nothing of the sort. I've heard them accused of being "institutionally corrupt" and that certainly tallies with what I've witnessed over the years. Evasion, dishonesty, cover-ups; I've seen it all.

[jamesbrown]

The CBS decision became final on 3 Dec 2019 when the Supreme Court refused permission to appeal, although HMRC would have been highly confident of victory long before then.

https://www.gov.uk/government/public...-contributions

It looks like it took HMRC over 2 years after that before launching a full-on attack against CK/Boox, so maybe it was far from obvious.

For those affected by this, my hope is that HMRC are chancing their arm, seeing how far they can push it. Sadly though I have little faith in the tribunals/courts who seem all too willing to do HMRC's bidding.

Oh, the implications were clear long before that. There was even some commentary on this website concerning Spotlight 32:

https://www.contractoruk.com/news/00...tlight_32.html

As has been very clear from this thread, HMRC were quite careful in their selection and targeting of CK and Boox as the next step along the way - they were certainly not chosen at random.

[Protagoras]

However the HMRC have stated that they believe employer pension contributions constitute indirect payments to the individual

An interesting development. I can't see anything obviously stating this in Ch9 - what's the basis for that interpretation, I wonder?

It's not as if employer pension contributions are employee 'benefits in kind' under other tax regulations.

[eek]

An interesting development. I can't see anything obviously stating this in Ch9 - what's the basis for that interpretation, I wonder?

It's not as if employer pension contributions are employee 'benefits in kind' under other tax regulations.

I can see that (pension contributions breach the 50% rule) being it's own tribunal later on - mainly because I can't see HMRC wanting it to be part of the initial tribunal which is very much is this attempted land grab allowed and how much further will a tribunal let us extend it..

[s684]

Oh, the implications were clear long before that. There was even some commentary on this website concerning Spotlight 32:

https://www.contractoruk.com/news/00...tlight_32.html

As has been very clear from this thread, HMRC were quite careful in their selection and targeting of CK and Boox as the next step along the way - they were certainly not chosen at random.

Ah, I see.

Maybe there's a chance it turns into another Arctic Systems for HMRC.

I certainly hope it doesn't drag on as long as the saga I'm caught up in. Received my first enquiry in Nov 2003. Should have settled a long time ago but sunk cost and all that.

[Bruce88]

An interesting development. I can't see anything obviously stating this in Ch9 - what's the basis for that interpretation, I wonder?

It's not as if employer pension contributions are employee 'benefits in kind' under other tax regulations.

I'm not sure why HMRC are taking this stance, other than they don't want to concede the point yet as it will discount myself (and probably others) from the legislation.

They have also asked for details on expense payments. I have a feeling they maybe trying to 'shoe-horn' the reimbursement of business expenses into the 'payment to the individual' interpretation. The way 61B(1) is written suggests to me that its purpose is to ascertain the level of taxable income/benefits the individual has taken from the business. Especially when you consider the way 61B (1)(b) is worded ‘Payments to the individual’ when taken in context with the subsequent clause 61B(1)(c) which states:

‘the way in which those payments are made would result in the individual (or associates) receiving payments of an amount (net of tax and national insurance) exceeding that which would be received (net of tax and national insurance) if every payment in respect of the services were employment income of the individual’

Surely, reimbursement of business expenses should not be mixed up in this calculation, as they would not be subject to tax and national insurance if they are legitimate.

[eek]

Surely, reimbursement of business expenses should not be mixed up in this calculation, as they would not be subject to tax and national insurance if they are legitimate.

Many business expenses would not be allowed if you were an employee / umbrella worker (think new laptop or expense a regular journey to work / your client's site) so i can see why HMRC would view those expenses (and hence nearly all expenses) as part of the calculation...