Reply to: Churchill Knight & Boox clients being investigated as Managed Service Companies

[jamesbrown]

Summary of the situation (one opinion, but sounds about right):

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

[GregRickshaw]

An advert for Osborne Clarke basically

[eek]

Quick google, found this
https://www.osborneclarke.com/insigh...rangements-and

Which tells me nothing other than the random opinion of what someone in Osbourne Clark thinks HMRC may do...

It doesn't say anything like SwissSaffa is implying - all it says is the rather obvious point that MSC legislation may be used again if the rules end up tightened again.

[Lotok]

Quick google, found this
https://www.osborneclarke.com/insigh...rangements-and

…and IR35, the agency workers tax regime and MSC?


In the meantime, HMRC is likely to significantly increase IR35 enforcement activity, use its powers under the agency worker tax regime (which in many ways is a better tool for HMRC than IR35) more widely, and apply pressure on contractor models by continuing action under the managed service company (MSC) regime. Each of these existing tax regimes already allow HMRC to target what it sees as false self-employment arrangements.

Might this increased activity, perhaps with extra funding for HMRC enforcement teams from a new government, be enough to eradicate (without new legislation) a lot of what may be seen as "bogus self-employment"?

[eek]

Looks like the new government is going to make things for MSC victims a whole hell of a lot worse if you read the Osbourne Clark article

What Osbourne Clark article?

[SwissSaffa]

Looks like the new government is going to make things for MSC victims a whole hell of a lot worse if you read the Osbourne Clark article

[jamesbrown]

Ah well we've said nearly everything which can be said

Very true

[GregRickshaw]

They can only assess 4 years back under discovery.

If they win against you guys, you can bet your bottom dollar they'll try and find a way of making the judgment fit other accountancy arrangements. Just like they made the CBS win fit CK and Boox.

Agreed 100% the shoe-horn approach is HMRC's bread and butter.

Ah well we've said nearly everything which can be said. Now we wait and wait and wait and wait.

HMRC do have a very nasty habit of ignoring retrospective rules mind.

[woody1]

How sure are we about this? I got a lot less than 50% out for every single year yet HMRC hasn't dropped my case. How do i make them look again into my case?

Write to HMRC stating your case, and requesting that they close the years.
Give them a date by which to respond eg. 30 days (or how ever generous you're feeling).
Tell them if you haven't heard anything by said date, or they decline to close the years, you will be referring the matter to your MP.
Send the letter "signed for" and keep a copy to show your MP later.

MPs are very good at getting HMRC to do the right thing.

[jamesbrown]

If they win against you guys, you can bet your bottom dollar they'll try and find a way of making the judgment fit other accountancy arrangements. Just like they made the CBS win fit CK and Boox.

This. Long time frames and opportunity costs are BAU for HMRC. They seek to probe, clarify and extend the interpretation of the legislation in their favour, and this happens incrementally over time. The idea that they will stop at CK and Boox is for the birds when there are much bigger players out there with a similar business model and practices that are as bad or worse than CK and Boox. They have the time and money to see where these tribunals lead. In the mean time, it all serves as a deterrent to operating a contracting business, about which they will lose little sleep.

[woody1]

and only go back 4 years? This is HMRC we are dealing with they'll go back as far as they like.

They can only assess 4 years back under discovery.

If they win against you guys, you can bet your bottom dollar they'll try and find a way of making the judgment fit other accountancy arrangements. Just like they made the CBS win fit CK and Boox.

[GregRickshaw]

How sure are we about this? I got a lot less than 50% out for every single year yet HMRC hasn't dropped my case. How do i make them look again into my case?

Who do you want to make look at your case? Your lawyers, your tax advisors, your accountant, HMRC?

Don't leave it to anyone else get your tax lawyer/advisor on it right away. My two years were thrown out by CK and their lawyers sure but I pushed HMRC very hard personally with my tax advisors to look at my case.

The 50/50's were thrown out by HMRC and CK lawyers because some of the test cases HMRC chose as lead cases were less than 50% ers.

[GregRickshaw]

If I was using an accountancy firm that operated anything like CK or Boox, I'd get out now.

If HMRC win this case, they're bound to test the boundaries even further and, as we know, they can go back 4 years.

I think if there were anymore to go after they would have started going after them by now.

Most of us are convinced HMRC started the investigation into CK around 2012 as this is when they 'almost overnight' stopped the payment advice, the dividends advice etc., took HMRC another 10 years to actually announce the investigation was open.

Then again maybe that's happening right now to others, as always ... who knows.

However if HMRC wait until 2030 and the likely final outcome of this, they will have lost an awful lot of revenue.

The Chritianyou case didn't really open the floodgates

and only go back 4 years? This is HMRC we are dealing with they'll go back as far as they like.

[gikap]

... to applying correctly and dropping the 50% or less PSCs...

How sure are we about this? I got a lot less than 50% out for every single year yet HMRC hasn't dropped my case. How do i make them look again into my case?

[woody1]

If I was using an accountancy firm that operated anything like CK or Boox, I'd get out now.

If HMRC win this case, they're bound to test the boundaries even further and, as we know, they can go back 4 years.