Can you think of ANY good reason why?

Serial companies

Didn't find your answer?

I am struggling to think of a good reason to form a £1 company, dissolve it after about 12 months and then form another and do that for 4 years on the trot. Obviously no accounts submitted. Is there any reason why I should not draw the obviuos conclusions?

Fill your boots. :-)

Replies (9)

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By Michael Beaver
07th Aug 2018 14:06

I presume what you mean by 'no accounts' is also 'no tax return' and 'no tax paid'. Other than deliberately setting out to do this stinking heavily of tax fraud, you'd be heavily reliant on the voluntary dissolution working in your favour.

During the dissolution process HMRC have a chance to object to the dissolution proceeding once the pending dissolution has been gazetted. HMRC have been a lot better at objecting to companies being dissolved after 12 months if they haven't received a corporations tax return, which would force you to do account and a tax return in any case.

And quite rightly so.

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By paulwakefield1
07th Aug 2018 14:17

I can only guess at no tax returns and no tax paid. But it has to be an obvious (typed correctly this time) conclusion.

The dissolutions went through pretty fast so I imagine no one objected. Whether that was because HMRC did not pick it up or because they had received returns I can't say.

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By Maslins
07th Aug 2018 14:30

I think if the company had submitted some CT/VAT returns for earlier periods showing trading profits, then HMRC are more likely to object.

Where it's the very first period, HMRC have no indication that there's been any trading. It must therefore be a tricky decision for them as to whether to spend a lot of money/effort objecting and insisting on stuff being submitted that doesn't come voluntarily, when there's a reasonable chance the company never traded.

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By paulwakefield1
07th Aug 2018 14:33

Good point.

I continue to think there is a whiff of rodent.

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By Mr_awol
07th Aug 2018 15:03

Does the director of this company live in a pineapple under the sea?

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Replying to Mr_awol:
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By paulwakefield1
07th Aug 2018 15:14

Had to look that one up. :-)

One suspects the mighty spongebob plan is indeed in play. I'm looking for any legit reasons for this behaviour. (Assume for these purposes that the aforementioned plan does not count as legit).

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By kestrepo
07th Aug 2018 15:35

Because if you are doing something dodgy it is only a years worth you will be prosecuted for.... initially?

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By Justin Bryant
08th Aug 2018 14:34

It has been stated on this website several times that this type of SBP tax evasion is only perpetrated by very dumb tax fraudsters. You do not have to think about it that hard to agree.

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By paulwakefield1
09th Aug 2018 08:27

Well I couldn't think of any legit explanation either and our man has withdrawn his application "after being made an offer we can't refuse" (I kid you not). Strange it happened when he found out we were doing a bit of digging. :-)

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