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    "Noted for the excellence of its white-collar defence practice"

    Chambers & Partners, 2014 edition

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    "Outstanding financial crime defence practice"

    Chambers & Partners, 2014 edition

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    "It’s a deluxe firm which pulls out all the stops for its clients"

    Chambers & Partners, 2014 edition

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    "They are the market leaders for serious crime’"

    Chambers & Partners, 2014 edition

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    "Kangs has an excellent reputation. They care about their clients and go the extra mile for them"

    Chambers & Partners, 2014 edition

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    "Kangs Solicitors is a standout firm"

    Legal 500, 2014 edition

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    "Kangs Solicitors is in the highest tier of firms"

    Legal 500, 2014 edition

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    "Hamraj Kang is noted for his very sharp legal brain"

    Legal 500, 2014 edition

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    "Kangs Solicitors fields a team of ‘technically able solicitors’
    and is well regarded for its serious crime and fraud work"

    Legal 500, 2014 edition

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    "Hamraj Kang is a shrewd tactician and very experienced"

    Legal 500, 2013 edition

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    "What the team is known for - handles an extensive array of criminal matters
    including murder, drugs and white-collar crime"

    Chambers & Partners 2013 edition

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    "Adept at dealing with cases that have an international dimension"

    Chambers & Partners 2013 edition

    Income Tax & National Insurance Avoidance

    Criminal Defence Solicitors | Vat & Tax SolicitorsNEWSIncome Tax & National Insurance Avoidance

    Jan

    6

    January 6 , 2017 | Posted by Kangs Solicitors |

    Income Tax & National Insurance Avoidance

    Managed Service Companies | Kangs Advisory Team

    John Veale of Kangs Solicitors considers the responsibilities of Managed Service Companies (‘MSC’).

    Legislation was introduced in 2007 to prevent artificial tax advantages being gained through the intermediary of a company disguising the true level of earned income by, for example, the payment of low wages supplemented by unrealistic dividend payments.

    Contractors/self-employed persons should be aware of trading situations where, as part of any contract that is offered, they are required to form their own limited company which is responsible for the payment of income tax and national insurance.

    Income earned through a MSC is as liable to income tax and national insurance, and hence the scrutiny of HMRC, as any other earned income.

    What constitutes a MSC | Kangs Tax Avoidance Prosecution Team

    HMRC say that you may be operating a MSC if:

    • The company’s business is the provision of a contractor’s personal services.
    • The contractor receives more than the MSC in fees and overheads.
    • The amount the contractor receives is greater than would have been the case if they had been employed by the MSC.
    • There is involvement with a firm of accountants.

    As, historically, service companies were frequently drained of funds and dissolved in order to avoid payment to HMRC the legislation introduced in 2007 sought to extend liability to third parties to prevent such activity.

    The legislation is becoming more relevant now as HMRC endeavors to enforce debts of MSCs.

    When the legislation came into force, providers of MSCs claimed that they could still circumvent the law and continue to provide the same sort of service to contractors and the self- employed with the result that HMRC has suggested  that contractors should be vigilant when dealing with such companies.

    MSCs | Potential Criminal Conduct | Kangs Criminal Solicitors

    Operating a MSC carries responsibilities for payment of full tax liabilities  to  the Revenue.

    If HMRC consider that the use of a MSC amounts to any form of scheme promoting tax evasion, cheating the revenue or any other financial fraud any individual involved may be subjected to criminal proceedings.

    How We Can Help | Kangs Criminal Solicitors

    At Kangs Solicitors we have an experienced team dealing upon a daily basis with all aspects connected to HMRC investigations.

    If you have any concerns with issues covered by this article, you should not hesitate to contact team through:

    Hamraj Kang
    hkang@kangssolicitors.co.uk
    07976 258171020 7936 6396 | 0121 449 9888

    John Veale
    jveale@kangssolicitors.co.uk
    0121 449 9888 | 020 7936 6396

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