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Managed Service Companies (MSCs)

Managed Service Companies essentially take over the running of a contractor's limited company. Such MSC providers / 'composite companies', particularly in the past, would group such companies together into 'schemes' in order to minimise tax and NI liabilities. Understandably, HMRC cracked down hard on MSC's from April 2007. As a result, IT contractors are now advised to work via their own limited companies, or umbrella companies.

Most contractors not confident of Managed Service Company rules

A new survey suggests that less than a quarter of contractors polled felt confident that they were operating within the Managed Service Company rules.
(Nov 11, 2008 in MSC Legislation )

Leading contractor accountant confirmed as "not caught" by MSC legislation

One of the UK's leading contractor accountancy firms says it has become the first to be confirmed by KPMG as not being caught by the controversial Managed Service Company legislation.
(Jan 10, 2008 in MSC Legislation )

Recruiters warned to "take care" when advising contractors

The REC has warned recruiters and other third parties (such as the end-users of contractors) to get their house in order if they want to avoid unwanted tax bills.
(Jan 8, 2008 in MSC Legislation )

Managed Service Company approval schemes

A legal view on recent speculation that a managed service company accreditation scheme is under consideration by HMRC.
(Sep 25, 2007 in MSC Legislation )

Managed service company 'audit scheme' being considered

HMRC is considering implementing an 'audit scheme' for managed service company providers. News of the proposed scheme has received a mixed response from within the contracting industry.
(Sep 21, 2007 in MSC Legislation )

Managed Service Company Guidance Note

HMRC have released a guidance document on the managed service company legislation. Includes indicators of whether a service provider may be an MSC provider.
(Jul 12, 2007 in MSC Legislation )

Contractors feel 'picked on' over MSC Legislation

Most contractors think that the impending legislation to effectively outlaw Managed Service Companies is unjustified and that it reflects an overall distrust of the self-employed by the British Government
(Jun 11, 2007 in MSC Legislation )

IT Contractors vindicated as MPs criticise Managed Service Company legislation

Opposition MPs voiced their criticisms of the new tax rules for Managed Service Companies (MSCs) during a Commons debate on the Finance Bill this week.
(May 2, 2007 in MSC Legislation )

MSC Legislation - Ordinary limited company contractors unaffected

The PCG has assured the IT contractor marketplace that ordinary limited companies are unaffected by the new tax rules on Managed Service Companies
(Apr 9, 2007 in MSC Legislation )

Managed Service Companies - How to recognise an MSC Provider

An overview of the Managed Service Company legislation and how it applies to contractors. How to recognise an MSC provider.
(Mar 30, 2007 in MSC Legislation )

Chancellor provides definition of a "Managed Service Company"

Details of the law that defines Managed Service Companies (MSCs) and explains how they will be penalised under the new tax legislation, have finally been obtained.
(Mar 22, 2007 in MSC Legislation )

Managed Service Company Contractor Calculator

A Managed Service Company Legislation Calculator has been launched to help UK contractors work out whether they will be affected by forthcoming changes to tax legislation due to be announced in the Budget today.
(Mar 21, 2007 in MSC Legislation )

Treasury to compromise on MSC tax laws?

The Times reports that The Treasury may compromise on the date the "third party rule" element of the MSC legislation will take effect.
(Mar 12, 2007 in MSC Legislation )

Company registrations soar ahead of MSC tax law

As the Managed Service Company legislation looms, the FT reports that company registrations have doubled as contractors aim to escape the Government's latest tax rules.
(Mar 6, 2007 in MSC Legislation )

Calls for MSC legislation to be well targeted

ICAS has called on HM Treasury to ensure that the proposed new legislation to combat tax avoidance by 'managed service companies' should be narrowly focused on those guilty of abuse.
(Mar 5, 2007 in MSC Legislation )

PCG submits formal response to Managed Service Company Proposals

The PCG has submitted its formal response to the Governments Managed Service Company (MSC) proposals.
(Feb 28, 2007 in MSC Legislation )

Umbrella Companies - Expenses, Dispensations and Assumptions

There appears to be some confusion within the freelance industry with regard to the proposed MSC Regulations and if they apply to Umbrella Companies who have an HMRC Dispensation to pay expenses.
(Feb 13, 2007 in MSC Legislation )

To switch and how to switch? – The ‘Controlling’ influence

Gordon Brown's intention to crack down on Managed and Composite Service companies has been well reported within the contracting market, but if you are working through a company which falls under this definition do you really know what to do?
(Feb 7, 2007 in MSC Legislation )

MSC's - Taxing times for contractors

The Recruitment and Employment Confederation is concerned that proposals to change the way a quarter of all contractors are taxed have not been thought through by the Treasury.
(Jan 19, 2007 in MSC Legislation )

Managed Service Company legislation "misguided"

The Treasury's plan to introduce legislation in April, which will effectively close down Managed Service Companies (MSC's), is likely to drive the non-compliance problem underground, according to a leading IT contractor accountant.
(Jan 12, 2007 in MSC Legislation )

Tackling Managed Service Companies (MSC's)

A comment on the managed service company changes included in the Pre-Budget Report, by a leading IT contractor accountant. What should contractors do next?
(Dec 22, 2006 in MSC Legislation )

MSC's - Managed Service Companies - What next for IT Contractors?

In light of the Chancellor's Pre-Budget Announcement on Managed Service Companies (MSC's), what now for IT Contractors?
(Dec 13, 2006 in MSC Legislation )

New Managed Service Company Proposals - A legal analysis

Pre budget report 6 December 2006: New managed service company legislation proposed - legal analysis of the new proposals, what might this mean for contractors?
(Dec 11, 2006 in MSC Legislation )

The death of composite companies?

The recent pre-budget report by the Chancellor of the Exchequer, Gordon Brown, has sounded the death knell for Composite or Managed Service Companies - an opinion piece written by Simon Dolan.
(Dec 7, 2006 in MSC Legislation )

Managed Service Companies

In delivering this year's Pre-Budget Report, the Chancellor made it clear that he intends to come down hard on schemes designed to avoid paying income tax and National Insurance. Top of the list are "Managed Service Companies".
(Dec 7, 2006 in MSC Legislation )

PCG gives cautious welcome to new tax proposals

The Chancellor's proposals to remove the tax advantage offered by composite and managed service companies is the big story for freelancers and contractors in today's Pre-Budget Report.
(Dec 6, 2006 in MSC Legislation )

Challenge to Service Companies who are ignoring IR35

The Government has announced a consultation on the employment status of contractors in the Budget, suggesting that some companies that operate a 'managed service' are clearly not complying with IR35
(Mar 28, 2006 in MSC Legislation )

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