Just want to warn other drivers out there, if you are thinking about going self-employed as Ltd Company do your research before choosing accountants. I have recently received a letter from HMRC and a rather large tax bill. Has anyone had similar problems with them. Would be interested to hear any feedback or experiences. Unfortunately, I have had to learn the hard way. Thanks.
I’ve moved this topic to where it can best be seen and discussed.
Harry7:
Just want to warn other drivers out there, if you are thinking about going self-employed as Ltd Company do your research before choosing accountants. I have recently received a letter from HMRC and a rather large tax bill. Has anyone had similar problems with them. Would be interested to hear any feedback or experiences. Unfortunately, I have had to learn the hard way. Thanks.
Can I just ask, did you do less than 6 months as LTD before changing to something else like PAYE, or did you do more than 12 weeks at one place.
I ask because i was with think and they advised me NOT to go LTD if I was planning on doing it for less than 6 months because it carried penalties from the tax man if you did less.
Harry7:
Would be interested to hear any feedback or experiences.
Harry make yourself a cuppa and have a read viewtopic.php?f=2&t=125766&hilit=Think+accounting&start=90
Does your tax bill exceed the current forum record bill of £15K-£16K?
peirre:
Does your tax bill exceed the current forum record bill of £15K-£16K?
£15650 actually peirre 
. It may be a forum record, but it’s nowhere near a record where I work! Anyhoo after much tooing and froing it has gone away after I proved that my Ltd Co was folded for legitimate reasons (I went PAYE) two weeks BEFORE the demand was sent. Ltd Co = limited liability.
They changed name again last week,been bought out again !!!
the maoster:
peirre:
Does your tax bill exceed the current forum record bill of £15K-£16K?£15650 actually peirre
Was this the result of working at 1 place of work for to long?
Thanks for all the responses/feedback, interesting. It makes me angry why they keep getting away with it, and the driver/worker has to suffer. It’s unfair and wrong. When I spoke to HMRC they advised me, they were unable to do anything about them because they keep changing their company name. As far as, I am aware my tax bill is £6500.00 but interest is accruing daily. I went Ltd company from PAYE at the beginning of the new tax year till 2015. I closed my Ltd company down because I had moved onto another company full time PAYE. I am in the process of writing letter to my local MP, to make him aware of this legislation/loophole. Power in numbers… Cheers.
weeto:
the maoster:
peirre:
Does your tax bill exceed the current forum record bill of £15K-£16K?£15650 actually peirre
Was this the result of working at 1 place of work for to long?
Not sure if it was a result of that tbh, nothing in the demand from HMRC stated that. As it happens I’d been working at the same place for over 5 years, so you may very well be right.
Harry7:
Thanks for all the responses/feedback, interesting. It makes me angry why they keep getting away with it, and the driver/worker has to suffer. It’s unfair and wrong. When I spoke to HMRC they advised me, they were unable to do anything about them because they keep changing their company name. As far as, I am aware my tax bill is £6500.00 but interest is accruing daily. I went Ltd company from PAYE at the beginning of the new tax year till 2015. I closed my Ltd company down because I had moved onto another company full time PAYE. I am in the process of writing letter to my local MP, to make him aware of this legislation/loophole. Power in numbers… Cheers.
But surely you could liable for the bill mainly because you may not be entitled to work in any other way but PAYE, it’s ok moaning about the accounting company that you are using and blaming them, but it is mainly up to the person requiring their services to know wether they are entitled to trade as LTD or not, not the accountant, they are just offering a service you require.
Perhaps you missed something when you signed up to be LTD with an accountant.
Harry7:
Just want to warn other drivers out there, if you are thinking about going self-employed as Ltd Company do your research before choosing accountants.
Which accountants you use is completely and utterly irrelevant. If the way the work was done does not follow HMRC’s rules for being classed as self employed then you risk getting a bill from HMRC. Basically if anyone tells you when, where to work, gives you instructions when doing the job, won’t let you choose who to send - in other words treated like a normal employee even though you’re a temp, then its employment. I doubt there are more than a very small few doing “self employed” through an agency who are actually meeting HMRC’s definition.
weeto:
Was this the result of working at 1 place of work for to long?
Has nothing to do with it. If you’re effectively working the same as an employee does, ie you have someone at the company you’re sent to by the agency giving you instructions, then its employment.
Harry7:
Thanks for all the responses/feedback, interesting. It makes me angry why they keep getting away with it, and the driver/worker has to suffer.
Because it is YOUR Ltd company that has committed the tax evasion, not Think Accounting. It is up to you as a director of your own Ltd Company to ensure that you are in full compliance with HMRC regulations. Your company, aka you, are the one putting in the receipts and invoices for tax deductible business expenses and claiming the business travel mileage.
There is no loophole, you are responsible for how your business is run. And I think too few drivers who decide to try and pocket a few extra quid going self employed realise that the buck stops with them, not the agency or the umbrella or the accountant firm you use.
HMRC find it very difficult/expensive to pursue IR35, Think fell under the MSC Legislation, basically because in HMRCs eyes they were too involved in their clients Co’s, thus making the client Co’s not a legitimate Ltd Co. making the Director ie the Driver an employee of his/her Company and so therefore he/she should pay Full NI and Income Tax on his/her earnings and not be able to draw a Dividend in order to reduce the tax bill or book expenses to bring down their tax bill.The bills which Driver’s are now receiving are mainly made up of an NI shortfall, with a lesser amount of Income Tax.
Think’s fiddle was with the FRS VAT. They creamed off the Ltd Co’s VAT monies and in most cases the Driver believe it or not did not even realise this until he terminated their services. Then Think would send out an invoice for extra work carried out which surprise surprise totalled the exact amount of Vat that Think had retained from their clients.
Conor, please stop posting on IR35 until you gain a basic grasp of the legislation. Your ignorance which you then post as fact could influence someone who is genuinely looking for advice. In a circumstance as serious as this all statements of fact should be backed up by links to the HMRC legislation you are quoting.
I believe (opinion not fact) that this will have nothing to do with IR35. It will have more to do with VAT and Corporation Tax. New Wave have been loosely interpreting VAT laws and deducting expenses that the company were not entitled to.
£6500 is a big amount for the period you are quoting (unless you were on mega money), in my opinion way to big for an IR35 charge.
My advice would be to read the HMRC guidelines and legislation and get a grip of it. It’s all there online, ignore the opinion of faceless idiots on a bulletin board. If you cant get a grip on it find a specialist accountant.
Alternatively, as suggested take the company bankrupt. Whatever Conor says it is the companies responsibility not yours. They may come after you and strike you off as a director, but for £6500 when you are not a director of multiple companies it is highly unlikely. They have bigger fish to fry. HMRC will be aware of New Wave and their many companies. They have sent you a bill as part of the bigger case. Whatever the doom monger says ignore him. Let him keep loosing out on his £400 p/w on paye.
here we go again…
calsdad:
Conor, please stop posting on IR35 until you gain a basic grasp of the legislation.
I do which is why I’ve never got a tax bill and this is about MSCs and the change in the relationship between agency, worker and client. Simple fact is very few drivers doing self employed via agencies truly comply with all of the regulations quite simply because its an employed position no matter how a useless ■■■■ like you wants to try to paint it in order to help you sleep at night instead of worrying about the tax bill you’re going to get.
Unlike you I’ve read the updates to the tax legislation.
Whatever the doom monger says ignore him. Let him keep loosing out on his £400 p/w on paye.
Well here is the second person who listened to a ■■■■■■■■ like you and ignored my POV and he’s got a bill for £6500. Another forum poster on here has a bill for just short of £16,000 and plenty of others are getting bills in the post too. so I would say that I’m more right than you.
Can’t wait till you get your bill and I’ll ■■■■ myself laughing.
I do wish Conor would give it a rest. He has either been shafted very hard by HMRC and is bitter or doesn’t have the balls to go direct himself because of his black and white interpretation of the rules so posts scare-mongering stories in an attempt to get everyone else worked up into a lather over it. 
Although IR35 should be fairly simple, it is so badly written that it can encompass almost everyone not working directly under PAYE, or almost no-one at all. This has been demonstrated by the Professional Contractors Group having won about 1,200 IR35 cases against HMRC vs. approximately 4 losses.
The substitution clause is without a doubt the first line of attack that HMRC would use and it’s fair to say that the vast majority of us would fall at the first hurdle there, but wait… We’ve had self-employed OMB (one man band) sparkies, plumbers and brickies since time began and none of those people would realistically be able to substitute themselves with another suitably qualified and experienced person either so do all those people fall foul of IR35 too then? I think not!
The other consideration is that in the event we could actually provide a substitute in the form of another suitably qualified and experienced driver, how many companies would use them? The answer to that would be very few, more likely none of them because of inductions, assessments, H&S procedures etc etc, it’s just not worth the hassle.
Furthermore, consider a OMB contractor on a MOD contract. How is a substitution clause meant to work there? No chance that the MOD would let some random replacement contractor come in, so there’s another perfect example of why IR35 is a complete shambles and not worth the paper it’s written on.
If people are still worried then there’s nothing to stop you from taking out IR35 insurance for ~£200/year which will cover you against any large HMRC bills should they deem you to be in breach of the regs.
The problem is that there is abundance of drivers that just want an extra couple of quid an hour without any of the hassle, legwork or effort involved in becoming a full fledged business, so they go on the agency and sign up to their ponzi umbrella schemes to be paid £500 per week with a £480 take home after fradulently claiming £500 per week tax relief for laundry, £1000 in travel expenses commuting to the yard at the end of their street and £700 per week subsistence for KFC takeaways and then wonder why HMRC comes knocking on their door wanting their money back. 
If you set yourself up properly with VAT rgd Ltd Co., PLI and £10k DNI with £750 excess and source yourself direct work (NOT via an intermediary) at a handful of places and have watertight written contracts in place then I firmly believe that unless you’re taking the ■■■■ by paying yourself minimum wage coupled with large divis and non-existent company expenses, HMRC will leave you alone. If they do decide to investigate then you can demonstrate to them that you have everything in place to show you’re operating as a genuine business with all the associated risks, rather than merely a vehicle of convenience solely for the purpose of tax avoidance which is how most s/e and ltd co drivers are set up to be just to get an extra quid an hour.
Personal insults Conor - How mature. And still no facts to back up your argument.
These bills from HMRC are nothing to do with IR35. These cases are to do with accounting irregularities … fraud. You using these cases to defend your position of choosing to pay more tax than necessary is likewise a tenuous link …
MSC/PSC does not mean that HMRC have used IR35 legislation to issue the fine. Different issue and different legislation.
The most idiotic part of your argument is that even if (or when in your tiny mind) a ltd company infidel (like myself) gets inevitably prosecuted by HMRC I personally do not get fined, the legal entity (the company) does. As Managing Director I will have responsibilities for correct management of the company, making provision for un-expected fines is not one of these so the company will be unable to meet it’s financial out-goings. I see bankruptcy of the company … not me on the horizon.
The mistake the people who have been fined made was using a dodgy umbrella company. To use this headline to make allegations about every ltd company driver is a ridiculous stretch even for you.
I for one would happily post my accounts on this forum along with my invoice detail for anyone to try and prove an IR35 case. The only issue is substitution, but then whats to stop me picking up the phone to a agency and hiring a driver…
And I’m still sleeping easy knowing I’m making 3-4 grand a year more than you, simply because i took the time to read the HMRC guidelines. Your constant inflammatory posting on this issue (which is normally 99% incorrect) indicates you are more affected by it than anyone else. Your voluntary gift of an unnecessary 3-4 grand a year to the HMRC must clearly sting a bit.
All that without an masturbatory insult…you ■■■■■■■
Mr Usher.
That is probably the best post on TNUK in the last 12 months.
When I am locked up for not having DNI and PLI (my risk even though it would make my company! look more real) at least you will be able to say i was warned. Please visit me in prison. 
ive been caught in the THINK ACCOUNTING situation , My bill has come in at a touch over £4750 and consider myself lucky that its not for anything more (at the moment) , Im just another driver who put their trust in this Accounting company to do my accounts and invoicing for the fee of £25 per week , I totally sympathise with the other drivers who find themselves in the same position as myself and can also understand the points put across by those who say its my own fault that ive gotten myself into this situation , personally I haven’t got a clue about , finance , invoicing , tax returns , etc etc , maybe if I,d taken more notice in school then I might have the knowledge of how to have done this on my own ,
The reason I,m writing this is to find out if theres any drivers who have any information on the directors and whether they are going to try and bring this / these people to court ,
Surly this is mismanagement of payments to THINK ACCOUNTING as they had a DUTY of CARE !! ?
spinner11:
The reason I,m writing this is to find out if theres any drivers who have any information on the directors and whether they are going to try and bring this / these people to court ,
Surly this is mismanagement of payments to THINK ACCOUNTING as they had a DUTY of CARE !! ?
I think you’ll find it has been discussed to death
here >>> viewtopic.php?f=2&t=125766&hilit=Think+accounting&start=90