IR35 was introduced to determine whether an individual was classed as an employee or not. Example, a Bricky working on a building site for maybe 2 to 3 years via his own Ltd company working along side an employee of the building company doing the same job. The Ltd Co Bricky would pay less NI and tax and be able to claim lots of expenses.IR35 would deem that the Ltd Co Bricky should be employed by the building company as the job was over a long period of time and there would be no reason why the building firm should not employ him directly. Meaning HMRC would get more tax and ni from him as an employee.
In practice due to the amount of people that work via a Ltd Co this way, HMRC do not enforce it as the workforce throughout the country would reduce overnight by thousands and thousands.
MSC Legislation is IR35 with teeth. MSC Legislation was introduced in 2007, bills followed roughly 7 years on! Note 7 years.
With any one man band Ltd company, the legislation does not “kick in” until there is a PROVIDER in the equation. Once there is a PROVIDER then that is when the problems start. By definition a one man band Ltd Co driver IS a Managed Service Company, this there is not an issue with, its when a PROVIDER is involved when it becomes an issue. Think Accounting have been deemed a PROVIDER by HMRC, they were not an agency, they were a “Mickey Mouse” accountancy firm. There are 5 testers to determine whether a firm are classed as a PROVIDER, the controlling of the Ltd Cos finances, ie the Drivers Cos finances, and the promoting of Thinks services, to name 2. As Think invoiced and collected the Ltd Cos earnings from the Agency then deducted tax, ni and fees, HMRC maintain this to be controlling the Drivers Cos finances, a website promoting their standardised packages, HMRC maintain this to be promoting their services. Basically the mass promoting of the setting up of LTD Cos for beneficial tax purposes. HMRC are sending out bills to collect NI and Income Tax for the period of time that the Ltd Cos were using Thinks services as HMRC maintain that the Ltd Co Director was deemed an employee of his Ltd Co and so therefore should have paid Full NI and full Income tax.
Using an umbrella scheme via Think does not fall fowl of the MSC Legislation, and Ltd Co Drivers that used Thinks services over a short period of time, less than a year, will probably not hear anything, dont forget HMRC are after the bones with plenty of meat on.
Every individual caught up in this mess has the right to appeal. MSC is new legislation and these bills are the first of many. HMRC are tarring everyone that used Think over the longer period with the same brush. Its well documented in the press that HMRC are not fit for purpose, the appeals system is completely snarled up with thousands of appeals. This legislation is very vindictive, put it this way, if you conduct your business by using the local Accountant up the street you would not have heard a hoot from HMRC, the fact that Think could not keep their house in order is the reason why their clients are receiving large bills, and before anyone states that the Drivers are tax/ni avoiders, like already stated HMRC dont target the individual company, Think had over 2000 clients registered at their address.The fact that Think are deemed a PROVIDER is the issue here.
Put another way you can operate as a one man band Ltd Co driver without any probs, if HMRC deem there to be a PROVIDER in the equation then you become an employee of your Ltd Co and therefore are liable to Income Tax, full NI and very few claimable expenses.
Then of course there was the VAT issue with Think, they took thousands and thousands from their clients, the fact that these people are able to set up company after company and walk away when things get too hot is proof that the powers that be, at the top, are not fit for purpose and appear to condone it in their greedy, bullying attempt to squeeze as much money as they can get from the working man whilst turning a blind eye to the real crooks.
Blimey still can,t believe English drivers, still fall for these scams, igloo Think .Newave it all a total con just formed to help EE drivers get into the transport game in the UK driving our trucks not paying any tax or ni for years changing there names of companies, then when they hit 45-50 yrs old they sod of back to there own countrys to be slumlords renting flats to mugs in there own countrys. This sort of ltd crap aint for English drivers unless you hitting 1k a week which is un likley in the uk, The government need,s to sort this crap out, instead of fighting other people,s wars, sort your own country first for fxck sake, If English do this scam you WILL be harassed by HRMC for year,s unlike the EE drivers they f off easy, If you want to be self employed do it yourself it aint hard cost around £300.0 per year but it aint worth unless you hit 1k per week.
Joey R:
Blimey still can,t believe English drivers, still fall for these scams, igloo Think .Newave it all a total con just formed to help EE drivers get into the transport game in the UK driving our trucks not paying any tax or ni for years changing there names of companies, then when they hit 45-50 yrs old they sod of back to there own countrys to be slumlords renting flats to mugs in there own countrys. This sort of ltd crap aint for English drivers unless you hitting 1k a week which is un likley in the uk, The government need,s to sort this crap out, instead of fighting other people,s wars, sort your own country first for fxck sake, If English do this scam you WILL be harassed by HRMC for year,s unlike the EE drivers they f off easy, If you want to be self employed do it yourself it aint hard cost around £300.0 per year but it aint worth unless you hit 1k per week.
Rant over.
so Scottish , Irish and Welsh drivers as bad as EE THEN
Joey R:
Blimey still can,t believe English drivers, still fall for these scams, igloo Think .Newave it all a total con just formed to help EE drivers get into the transport game in the UK driving our trucks not paying any tax or ni for years changing there names of companies, then when they hit 45-50 yrs old they sod of back to there own countrys to be slumlords renting flats to mugs in there own countrys. This sort of ltd crap aint for English drivers unless you hitting 1k a week which is un likley in the uk, The government need,s to sort this crap out, instead of fighting other people,s wars, sort your own country first for fxck sake, If English do this scam you WILL be harassed by HRMC for year,s unlike the EE drivers they f off easy, If you want to be self employed do it yourself it aint hard cost around £300.0 per year but it aint worth unless you hit 1k per week.
