Representing yourself at an FTTT hearing

[DealorNoDeal]

NOTE: this is for people who don't have insurance that would cover the cost of representation

Normally I'd agree with this:
https://www.phrases.org.uk/meanings/...-a-client.html

However, in the case of CK and Boox, there is an argument to be made for representing yourself.

Firstly, on cost. The cost of hiring advisors, barristers to represent you can run into to tens of £thousands. It could even end up being more than what you potentially owe in tax. And the FTTT virtually never awards costs, so if you win you won't be able to get HMRC to pay your legal fees. (Obviously, the flip side of this is, if you lose, HMRC can't sting you for their legal costs.)

Second, the hearing will be all about what happened on the ground. The question, as to whether your company was an MSC or not, will rest on the facts of how you ran the company on a day to day basis, and you know that better than anyone else.

Some may fear being intimidated by HMRC lawyers. However, I know of a couple of people who represented themselves at the FTTT, and the Judges did not allow that to happen. In fact, they were very helpful.

So, in short, I don't think it's necessarily a bad idea to represent yourself in this instance.

[cojak]

Thanks DOND, duly stickied.

[GregRickshaw]

NOTE: this is for people who don't have insurance that would cover the cost of representation

Normally I'd agree with this:
https://www.phrases.org.uk/meanings/...-a-client.html

However, in the case of CK and Boox, there is an argument to be made for representing yourself.

Firstly, on cost. The cost of hiring advisors, barristers to represent you can run into to tens of £thousands. It could even end up being more than what you potentially owe in tax. And the FTTT virtually never awards costs, so if you win you won't be able to get HMRC to pay your legal fees. (Obviously, the flip side of this is, if you lose, HMRC can't sting you for their legal costs.)

Second, the hearing will be all about what happened on the ground. The question, as to whether your company was an MSC or not, will rest on the facts of how you ran the company on a day to day basis, and you know that better than anyone else.

Some may fear being intimidated by HMRC lawyers. However, I know of a couple of people who represented themselves at the FTTT, and the Judges did not allow that to happen. In fact, they were very helpful.

So, in short, I don't think it's necessarily a bad idea to represent yourself in this instance.

Great article thank you. I wonder if this is the way I may go. I have no insurance for this.

BTW I did what cojak k suggested in the early days of this post and found literally everything about my LTD which proves (apart from the sodding fee) there is no way I could be an MSC. When I consulted with WTT initially they said because you know so much about your own company there is a good chance. The real MSC at times didn't even know the company name the MSCP had given them!

[DealorNoDeal]

Great article thank you. I wonder if this is the way I may go. I have no insurance for this.

Personally, I would only consider doing this after the 5 test case appeals have run their course.

The real MSC at times didn't even know the company name the MSCP had given them!

Yep, that probably applied to most of CBS' clients. They were just allocated a random company by CBS. Even the guys that went to court were clueless about their companies.

Once the MSC legislation came into force, CBS went on to create 1400 new companies in the period 2007 to 2010, 1000 of which were personal service companies. Most of these companies used CBS for their registered address and for company secretarial services.

Several key signs that that the contractors concerned were not in control of their own affairs emerged during this period: the contractors were unaware of the need for a registered office address and that they had a choice; and none were given guidance about the requirement for a company secretary and that they could appoint their own.

In fact, one of the contractors whose appeal was overturned in this ruling, Dr Jacek Trzaski, was: “was unaware that he had a registered office or that he needed one” and was unaware that he had needed a company secretary or, indeed, that he had one.”

[GregRickshaw]

Food for thought though. Someone has to go first though.

[mudskipper]

Food for thought though. Someone has to go first though.

A couple of things -

Ideally the test cases would have expert representation. A good percentage of those affected will have insurance, and I imagine the insurers are also keen to prove their worth. If HMRC lose all the test cases, the rest of you may not have cases to answer at all.

Secondly, I'm really surprised you want to be a test case. I genuinely don't mean this in any way disparaging or criticising, but from earlier posts you seemed extremely stressed by the whole situation to the point where you wanted to pay to make it go away. Being a test case will be incredibly stressful - are you sure it's what you want?

[eek]

A couple of things -

Ideally the test cases would have expert representation. A good percentage of those affected will have insurance, and I imagine the insurers are also keen to prove their worth. If HMRC lose all the test cases, the rest of you may not have cases to answer at all.

Secondly, I'm really surprised you want to be a test case. I genuinely don't mean this in any way disparaging or criticising, but from earlier posts you seemed extremely stressed by the whole situation to the point where you wanted to pay to make it go away. Being a test case will be incredibly stressful - are you sure it's what you want?

I wouldn't say it's just ideal that the test cases have expert representation - it's essential that they do - I half suspect some that the MSC legislation is only being used because the initial CBS judgement opened up whole areas for HMRC to attack that they never dreamed would be possible.

The issue then becomes a different one of who is going to pay for that expert representation and that is going to require fund raising and probably a few accountancy firms contributing to ensure they aren't next in line.

[hobnob]

In fact, one of the contractors whose appeal was overturned in this ruling, Dr Jacek Trzaski, was: “was unaware that he had a registered office or that he needed one” and was unaware that he had needed a company secretary or, indeed, that he had one.”

The company secretary bit is odd. Obviously it's a problem if you're not aware that you have one, i.e. a director should know who the company's officers are. However, that role has been optional since 6th April 2008.

The linked article is from April 2016, and "The determinations and decisions were made for the tax years 2007/08 to 2009/10". Maybe the Articles of Association referred to a company secretary, either because the company was created in 2007 or because the MSCP used the same standard template after the role became optional?

Anyway, it makes sense for anyone who's used CK/Boox to check whether their company has a secretary, but no need to panic if it doesn't have one.

[GregRickshaw]

A couple of things -

Ideally the test cases would have expert representation. A good percentage of those affected will have insurance, and I imagine the insurers are also keen to prove their worth. If HMRC lose all the test cases, the rest of you may not have cases to answer at all.

Secondly, I'm really surprised you want to be a test case. I genuinely don't mean this in any way disparaging or criticising, but from earlier posts you seemed extremely stressed by the whole situation to the point where you wanted to pay to make it go away. Being a test case will be incredibly stressful - are you sure it's what you want?

No that's cool I have come a long way since those early days. Watched many webinars, read many pieces and generally blown out a huge load of air. Headless chicken mode was indeed invoked early on. In a way I'm glad this has rumbled on it's made me much more focused and less stressed.

Quick update from CK, they have suggested a similar thing (and they have more than enough volunteers apparently), those with insurance and expert reps should go first as as you say if all five cases collapse then it may all go away.

However, I am prepared now to fight my case should it come down to individual cases mainly thanks to the strength of this forum.

[Guy Incognito]

The Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009 (legislation.gov.uk)