How do we compare on IR35 compliance?

There are two areas of compliance to compare and consider.

IR35

The first is IR35. If you are a contractor working through a limited company, we believe proper IR35 compliance is essential and not an ‘optional extra’.

Advice on employment status (IR35) is very rarely offered as standard, but should be a prerequisite for the basic tax planning advice accountants give to contractors. Make sure you are getting a documented written opinion from employment law experts.

At Brookson, we use employment law specialists to provide you with a written expert opinion on your employment status with every assignment.

MSC Legislation

The second area of compliance to be aware of is Managed Service Company (MSC) legislation.

If you are receiving a limited company service and it feels like the accountant is in financial control of your company rather than you, then you need to be extremely wary.

An indicator may be where your accountant holds onto your VAT and corporation tax money that has accumulated.

In our view, contractor accountants should not hold customer money, bank it or receive interest on it because controlling your cash may be considered as being involved with your company.

MSC legislation aside, this is extremely unwise. In the event that your accountant gets into financial difficulty, you may not be able to get hold of your company’s cash, but your company will still legally owe the money!

With Brookson as your accountant, we never handle your cash.

You keep your VAT and corporate tax money safe in your bank account, then you make the decisions about when to make the payments.

Brookson fully understand this legislation and can say with absolute confidence that our customers are not captured by the Managed Service Company legislation.

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