One of my clients had a LLP which is now closed.
The deatils were incorrectly held at HMRC and they asked HMRC to change them many times.
They incorrectly filed PAYE as weekly instead of monthly using the HMRC Software.
HMRC Suggested they start again and refile. They did this and thought it was fixed.
A field agent from HMRC turned up today and left a letter chasing the debt.
Questions are as follows:
Can they chase a debt on a closed LLP?
They have listed the debt to the partners and not the LLP?
What can be done to stop collection while this is rectified and how best to approach this?
Thanks in advance.
Replies (7)
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Start from the beginning. Is the "debt" correctly stated or not?
If so how was it dealt with in the dissolution accounts?
First phone the field agent and explain that this is a disputed charge. This will halt collection for now.
Then phone PAYE helpline to make sure all specified charges and interest created by the incorrect weekly filing expectations have been cancelled by the refilling.
Once you have agreed any outstanding liability is correct then of course they can come after the partners, a partnership has always been transparent for tax and an LLP is no different in that regard as far as I am aware
We are not told that there is any dispute over the debt.
There may be of course, but we have no idea until the OP tells us.
And on the question of whether an LLP is any different from a partnership in respect of members' personal liability for its debts, have you ever reflected on what the "LL" letters stand for?
@John - weekly instead of monthly will have created incorrect entries and specified charges - this merely puts the ball back to the main PAYE office instead of debt collection while they identify the right position. Of course I know what the LL stands for but I also know that there is legislation for tax purposes which makes the LLP transparent and leaves the partners liable in the same way as an ordinary partnership.
Do you still have a contract with the client/partner(s)/LLP and are you going to be paid to sort this out?
Do you still hold Agency, even though the LLP is defunct?