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Since the MSC Legislation arrived in 2007 compliance has been a hot topic in the umbrella company industry. Before the legislation came in there was a lot of variation between the way different companies operated and the services they offered, but after the legislation was introduced all that had to change.

Umbrella companies became the only game in town, and where there was previously a certain amount of give in how an umbrella company might be run, suddenly they were a defined legal structure, with any variation bringing with it the chance of non-compliance.

It might seem simple to follow a structure that has already been set out, but as with a lot of tax legislation there are huge grey areas that need to be explored. This is the reasons you will see discrepancies in the way different companies operate.

Essentially at this stage it all comes down to who you've taken advice from and their understanding of the business, until HMRC start testing and investigating companies there is some room for interpretation.....

.....except that we're right of course.

Next week I'll go a little more in depth as to what companies are complying with. In the meantime have a great weekend.

Hugo
19/06/2009