For those of you that know what the MSC legislation is but thought it had gone away, think again, HMRC are due to bring a number of cases to Tribunal this year; so you’re going to be hearing lots more about it.
For those of you that don’t know what it is; it’s IR35 with teeth! The teeth are due to the fact that unlike IR35, the liability doesn’t just fall on the company and you walk away; there’s a nasty sting in the tail called the “Transfer of Debt” legislation which allows HMRC to transfer the debt to you or others in the chain…..
So what’s that got to do with Accounting firms that aren’t regulated by a Professional Body and why should you care?
For you to fall foul of the legislation, there needs to be a provider that is involved in the running of your company, a provider can be a person supplying accounting services and to put it into context, involved can just mean you have IR35 losses insurance!
However, the legislation gives a specific exemption for persons being MSC Providers. BUT only to persons professionally qualified and regulated by a regulatory body. Please see https://www.hmrc.gov.uk/employment-status/msc-guidance-july07.pdf (Page 8, Para 4)
So, all of a sudden you can see why it’s important to use a regulated firm, but how can you tell?
Well, the simplest way is to look for a Chartered logo on their website.
Do not be confused by these:
These do not mean the firm is regulated unless the previous logos also appear, a clever tactic being used by a number of firms.
The reason we’re highlighting this matter now, is that some firms of accountants have statements on their website such as;
“Independent Accountants are not caught”
“A firm providing accountancy services is exempt from MSC legislation”
Now, if you click on the HMRC link above, you will see that it doesn’t say that at all, so once again, Caveat Emptor- BUYER BEWARE
Unhappy with your Current Accountant?
If you’d like to discuss switching accountants then please contact us on 0800 954 2101 or complete the form opposite.
How Could Freestyle Help You? Find Out Now…
Enter your details below for a personalised quote and further details on our service.