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Debt transfer FAQs
Does, we do not give advice, stand up to close scrutiny?

In theory the answer is yes, although in practice we do not believe this to be a robust position to take in isolation.

To examine this more closely, we have to imagine a situation where a contractors provider has been assessed as caught by the MSC legislation. In this situation, the contractor will receive a notice of additional taxes due. Whilst a contractor can only make an appeal by challenging the legal aspects, as no consideration is taken of their efforts to use a compliant provider, this will probably not prevent them from using any evidence they have that can show they were influenced in their choice. If, in this attempt to clear themselves they were to produce any evidence such as an email or telephone conversation that showed any form of influence, guidance or direction by an agency, then the agency would be potentially caught.

In our discussions with agencies, it is clear they are sales led operations and as such this brick wall approach has the potential of being circumvented at the front. If this were to happen, we believe that the agency would not be able to demonstrate robust enough internal procedures to remove themselves from the liability.

In our opinion, if an agency were to take this approach it would always needs to be supported with direction given to the contractors on where they can go to seek independent professional advice or direction where required. Agency members have the ability to give free access to their contractors to the Professional Passport contractors site that provides this independent professional advice.

By adding this simple aspect to the process it makes the agency position far stronger and increases the chances of successfully demonstrating robust internal procedures.

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