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Client completed DS01 to strike off company

due to HMRC debts

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I have been an accountant for sole director limited company for a few years.  The company activity is IT Consultancy 

We have had a good relationship and she seemed someone who was law biding and honest.

Last year, she was told by her client that she would be converted to an employee and relunctantly agreed.  We then took steps to close down the company.  

Sent her the  Final Accounts, Corporation Tax Return and Self Assessment for approval.  The amount of tax due came to a surprise to her and told me since she had moved into employment as a much lower income  she could not afford it.  Obiously she has had taken out all the money from the company and spent it.  I said we couldn't close the company until HMRC are paid.    

She then contacted me telling me she been advised to complete the DS01.  I said HMRC would object.  This was a couple months back.

I then received a letter from HMRC last week saying they have objected to striking off the company due to they believe the company owes taxes.  We have not filed the Corporation tax as yet as are waiting for the client approval.

I am dismayed she could actually do this.  Should I report her ?

I will now have to disengage earlier than scheduled.  

 

Replies (17)

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RLI
By lionofludesch
20th Sep 2020 23:22

Not sure there's much point now. To whom were you thinking of reporting her?

Who "advised" her ?

I have to say that this is great news. HMRC chasing up their debts at last.

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Replying to lionofludesch:
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By sanjay100
21st Sep 2020 10:05

SOCA and probably bloke from the pub advised her as this bloke may have done it themselves in the past.

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By Paul Crowley
20th Sep 2020 23:34

If I read correctly there is now tax on a loan as an extra liability.

What to do now would be a David question.

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Psycho
By Wilson Philips
21st Sep 2020 08:04

I would say there is a reporting obligation - you have suspicion that she filed a DS01 without, as required by law, notifying all creditors. It would be pointless of course, since HMRC are already ‘aware’. But that does not relieve you of your obligation. File the report, issue your final fee and disengage.

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By memyself-eye
21st Sep 2020 08:31

Does she know HMRC have objected?

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Replying to memyself-eye:
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By sanjay100
21st Sep 2020 10:03

I would think she does since presumably she would have received the same letter as I have.

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Replying to sanjay100:
Red Leader
By Red Leader
21st Sep 2020 13:21

Check that the reg office address is one where you can be sure she will be getting the post. Why did you get the letter? Did she put you down as the "presenter" of the DS01?

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Replying to Red Leader:
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By sanjay100
22nd Sep 2020 22:08

I didn't get the DS01 but a letter from HMRC stating like they do that they have objected to striking off the company then went onto companies house website to have a look and saw the handwritten DS01

It would be good if David Winch does let me know if I have a SOCA reporting obligation.

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Replying to sanjay100:
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By Cheshire
21st Sep 2020 13:25

I would make sure she gets a copy of the one you have, send a copy of the rules around issuing a DS01 along with a request for her confirmation to file the CT etc so that she doesnt become a tax evader.

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By Duggimon
21st Sep 2020 10:05

It would be worth pointing out to her that the overdrawn loan account makes her personally liable for the debt to HMRC and if she doesn't want them coming after her personal assets, it would be best to get everything filed, up to date, and agree a payment plan because the head in the sand approach is now the worst one she can take.

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By bernard michael
21st Sep 2020 12:17

Must be lot of money due to HMRC as they don't normally object for small amounts

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Replying to bernard michael:
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By sanjay100
22nd Sep 2020 22:09

No, HMRC seems to object on most DS01 applications if the company has been trading previously.

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Replying to sanjay100:
ALISK
By atleastisoundknowledgable...
28th Sep 2020 22:08

I’ve had 3 DS01s objected to in the last month. One had never done anything other than be incorporated.

I suspect they have 1 eye on people DS01-ing companies post BBL.

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Replying to atleastisoundknowledgable...:
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By Justin Bryant
29th Sep 2020 09:16

I doubt that's true, as it seems most these companies now doing a runner were fraudulently set up in the 1st place, as the muppet bankers did no (proper) checks.

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Replying to Justin Bryant:
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By bernard michael
29th Sep 2020 09:26

Justin Bryant wrote:

I doubt that's true, as it seems most these companies now doing a runner were fraudulently set up in the 1st place, as the muppet bankers did no (proper) checks.

The "muppets" have given loans guaranteed by the Govt and therefore have nothing to lose so what incentive is there to bother to check properly

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Replying to bernard michael:
RLI
By lionofludesch
29th Sep 2020 10:43

bernard michael wrote:

Justin Bryant wrote:

I doubt that's true, as it seems most these companies now doing a runner were fraudulently set up in the 1st place, as the muppet bankers did no (proper) checks.

The "muppets" have given loans guaranteed by the Govt and therefore have nothing to lose so what incentive is there to bother to check properly

Well, you'd like to think that there was something in the guarantee small print which suggested that the Government might not pay out if there weren't enough checks.

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Replying to lionofludesch:
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By bernard michael
29th Sep 2020 11:21

[quote=lionofludesch]

bernard michael wrote:

Justin Bryant wrote:

I doubt that's true, as it seems most these companies now doing a runner were fraudulently set up in the 1st place, as the muppet bankers did no (proper) checks.

The "muppets" have given loans guaranteed by the Govt and therefore have nothing to lose so what incentive is there to bother to check properly

Well, you'd like to think that there was something in the guarantee small print which suggested that the Government might not pay out if there weren't enough checks.

[/quote

Wishful thinking

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