RegulationCorporate GovernanceHMRC unimpressed with composite providers’ advertising

HMRC unimpressed with composite providers' advertising

HMRC looks at service providers' advertising and says many are still caught within new tax rules

Many business service providers presenting themselves as accountants to dodge
new tax rules could still be caught within the new legislation, according to HM
Revenue & Customs.

Composite company providers have courted controversy by
presenting themselves as accountants.
Accountancy services provided to contractors are exempt from new tax rules that
aim to end the use of composite company structures. The structures enabled
contractors to avoid a proportion of tax and NI liabilities.

However,
HMRC
stated that, based on advertising it had seen, many service providers were
still caught under the new legislation and might face tax liabilities.

‘If a service company is within the legislation and the company fails to
operate PAYE, this could result in individuals being held personally liable for
the PAYE debts of the company,’ stated HMRC.

The new rules could also force service providers to face the tax liabilities
of the contractors operating within the composites.

Further reading:

HMRC attempts to clarify
composites’ tax rules

Composites ‘posing as accountants’

Company providers ‘pose as accountants’ to
dodge new rules

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