Churchill Knight & Boox clients being investigated as Managed Service Companies

[woody1]

FWIW this is terrible advice.

I was merely relaying what someone did which worked out fine. The only advice I gave, to anyone contemplating bankruptcy, was to consult an Insolvency Practitioner (IP).

Remember, when it comes to bankruptcy, it's the trustee in bankruptcy who handles everything (not HMRC). Incidentally, invariably, the trustee is an IP.

[dayd08]

Without getting into the semantics of the wording, it’s a fine/penalty, not tax, that’s HMRC’s line on it. You’d be best to speak to tax experts (not solicitors or anyone related to any of the companies that may have got you into the mess).
We have good reports for Gilbert Tax and others. They aren’t going to come up with schemes, but will take the headache away from you and help with getting a reasonable time to pay.

Thanks for the response. The reason why I asked is the letter from HMRC mention about double taxation and claim relief.

"To prevent double taxation, the MSC rules allow customers to claim relief for tax paid on dividend payments, and overpayment relief for Corporation Tax, on amounts treated as deemed employment payments"

[GregRickshaw]

Thanks for the response. The reason why I asked is the letter from HMRC mention about double taxation and claim relief.

"To prevent double taxation, the MSC rules allow customers to claim relief for tax paid on dividend payments, and overpayment relief for Corporation Tax, on amounts treated as deemed employment payments"

Does anyone actually know the rules, seems to be a different set every month. What most experts are agreed on is the liability actually/probably will only be your NI. However I don't believe HMRC have 100% confirmed the above payments will come back. Everyone is assuming they will..... we all know what it is to assume.

[woody1]

Does anyone actually know the rules, seems to be a different set every month. What most experts are agreed on is the liability actually/probably will only be your NI. However I don't believe HMRC have 100% confirmed the above payments will come back. Everyone is assuming they will..... we all know what it is to assume.

The letters they're sending out are inviting people to settle. Settlement is full and final. Surely they must have nailed down how they're going to credit people for what they've previously paid in IT/CT/NI?

[WTFH]

Surely they must have nailed down how they're going to credit people for what they've previously paid in IT/CT/NI?

Yes but no but yes. This is HMRC we're talking about. They will have a framework set of internal rules on how they will create a calculation to determine the amount to be calculated, but not a defined calculation that can be written down in such a way as to be clear to anyone who doesn't have their framework or rules.
i.e. they will arrive at a figure on a case by case basis.

[woody1]

i.e. they will arrive at a figure on a case by case basis.

I wonder how complicated that could get? Company pension contributions come to mind but there's probably other stuff to untangle.

[GregRickshaw]

The letters they're sending out are inviting people to settle. Settlement is full and final. Surely they must have nailed down how they're going to credit people for what they've previously paid in IT/CT/NI?

When did these letters start coming? They have a FTT starting early 2026 with lead/test cases and now you are saying they are sending out settlement letters?

Can you explain the figure you have been quoted in their words please?

This is HMRC there is no surely here, the figures will also fluctuate wildly not based on amount of income or CT but based on all the other factors.

Be good to see what they (HMRC) are now proposing to you. No need for figures just wording please.

[woody1]

When did these letters start coming? They have a FTT starting early 2026 with lead/test cases and now you are saying they are sending out settlement letters?

Can you explain the figure you have been quoted in their words please?

This is HMRC there is no surely here, the figures will also fluctuate wildly not based on amount of income or CT but based on all the other factors.

Be good to see what they (HMRC) are now proposing to you. No need for figures just wording please.

Sorry if I wasn't clear, I was just referring to the letter jowolfe had received which gave the option to settle. (I'm not caught up in this) https://forums.contractoruk.com/hmrc...ml#post3015103

Apart from company pension contributions, another complication comes to mind. What if a spouse/partner had been receiving salary/dividends?

[jowolfe]

Yes but no but yes. This is HMRC we're talking about. They will have a framework set of internal rules on how they will create a calculation to determine the amount to be calculated, but not a defined calculation that can be written down in such a way as to be clear to anyone who doesn't have their framework or rules.
i.e. they will arrive at a figure on a case by case basis.

Just to clear though, sorry if this has been explained elsewhere... does it seem likely there will be a process for offsetting some of the total NI being claimed against tax paid in other sources e.g. corporation tax, dividend tax etc. The full figure they are requesting from me is pretty eye watering - but if it's offset against some of my previous payments then it starts to look a little less frightening.

[jowolfe]

Without getting into the semantics of the wording, it’s a fine/penalty, not tax, that’s HMRC’s line on it. You’d be best to speak to tax experts (not solicitors or anyone related to any of the companies that may have got you into the mess).
We have good reports for Gilbert Tax and others. They aren’t going to come up with schemes, but will take the headache away from you and help with getting a reasonable time to pay.

With regards to HMRC regarding this as a penalty rather than tax - is that something you've read somewhere? Would be interested to know where that's coming from. At the moment all of the correspondence I've had from HMRC indicates that they're pursuing it as collection of unpaid tax - in which case I would have assumed that the principle not to tax the same income twice should apply. Thanks