As the result of an HMRC investigation into previous years my client ( who I signed up 12 months ago) has received an assessment for underpaid corporation tax over 5 years because of errors in the capital allowance calculations.
The Company cannot pay the amount owed at this moment in time and it is arguable whether they would likely to be able to pay much in the foreseeable future.
Does anyone have any experience of negotiating with HMRC in a situation where their assessment may push a Company into liquidation?
My inclination is to suggest to the Company that they consider dissolving the Company, letting HMRC know (as the only creditor) and see what happens. The Company could not afford to appoint insolvency practitioners.
There are no balances on the Directors Loan Account.
A new situation for me so any guidance would be appreciated.
Replies (6)
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Assuming this is not case of phoenixism, write to HMRC saying the company has no resources to pay the tax owed. As a solution invite them, as a creditor, to wind the company up and recover whatever is available. Give them a reasonable deadline and if no response is received shut the company down. End of.
He could also be liable for any damages suffered by your client eg loss of income if it could be proved to be caused by the old accountant.Has he been notified of the problem and the potential PI claim?