Personal Service Company

Personal Service Company

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I have a client that provides translation services for banks with operations in uk. He has about 30 different clients - has his own office, has his own PI insurance, has two employees (but does most of the work himself), can nominate anyone else to do the work, has to advertise, and has to redo work at his own expense.

Is his company a personal service company?

IR35 is not applicable in any shape or form so I am not worried about that but I have done his EOY submissions to HMRC but didn't tick the PSC question and am wondering whether I need to resubmit it. I would only usually tick it for contractors in the normal sense - i.e. going to work a one clients premises at a time.

Thoughts?

thanks

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Euan's picture
By Euan MacLennan
17th Apr 2014 14:18

The correct answer was No

The HMRC guidance (scroll down a bit to Service Company) says :
'Yes' if you are a service company - 'service company' includes a limited company, a limited liability partnership or a partnership (but not a sole trader) - and have operated the Intermediaries legislation (Chapter 8, Part 2, Income Tax (Earnings and Pensions) Act 2003 (ITEPA), sometimes known as IR35). Otherwise indicate 'No'.

The operative word is the "and" I have highlighted.  If you haven't operated IR35, rightly or wrongly, the answer to the Service Company question is No.

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By andy.partridge
17th Apr 2014 14:47

Agreed

You probably don't need a 2nd opinion after Euan's excellent answer, but if you do, this is it.

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