High Street accountancy firms have been investigated by Freelance World, a contractor services company based in Aberdeen. Freelance World carried out their ‘mystery shopper’ survey which found that many high street accountancy firms have little or no knowledge of legislation pertaining to contractors such as IR35 and Managed Company legislation. They also noted that many of the firms they approached had a “worryingly vague attitude to the need for compliance within the legislation”.
Managing Director of Freelance World, Alasdair McGill said, “We have been genuinely alarmed at the poor advice being given by some firms to prospective clients. It is like going to a GP for treatment when you really need to see a specialist consultant. It is quite clear that many high street accountancy firm simply do not have the expertise to advise contractors on key legislation, compliance and management of their specific requirements.”
He continued, “One accountant offered an off-the-shelf incorporation service – a practice that is prohibited by the Managed Service Companies legislation of 2007. Another told a researcher that they ‘didn’t need to worry about IR35’”
Worryingly, one firm that was approached by the researchers said that IR35 “had died a death”. The repercussions for a contractor accepting that advice could be large HMRC fines and possibly even long term credit problems due to non-compliance. Contractors are therefore advised to only use specialist accountants.