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HMRC served stat demand

HMRC have served a statutory demand on our client and are now in a position to make him bankrupt

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Previous annecdotal evidence suggests that even in the absence of a formal TTP agreement, HMRC will not persue the bankruptcy petition if our client is making regular payments, as this is one of the questions the judge would ask, likely resulting in it not being granted. Can anyone confirm categorically if that is the case?

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By Trethi Teg
13th Feb 2020 16:33

If you wanted a "categorical" answer I think you should have spent more than 30 seconds typing out the 18 words of information upon which a "categorical" answer could be based.

Do you expect anyone to provide such an answer when it is obvious that you have only provided about 5% of the facts which might be required to provide an opinion based on previous experience.

0/10 for effort.

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By Duggimon
13th Feb 2020 16:42

I wouldn't base my client's financial future on anecdotal evidence.

Why try to secure their position by making payments without a TTP arrangement? Why not contact HMRC and make a formal TTP arrangement? Is the issue that HMRC want more than your client can reasonably afford? Is there a huge difference between these proposed informal payments and HMRCs requirements for a TTP? How old is the debt? How much has your client paid so far? How much do they actually owe? How long do they need in order to pay it? Would HMRC be able to recover their money by pursuing bankruptcy?

All these questions and more could be relevant!

That said, provided the payments are being made in an earnest effort to repay the debt and aren't just a drop in the ocean cynically devised to pre-empt a move for bankruptcy, it is unlikely HMRC would pursue bankruptcy. However they still could, and your client would be better off agreeing an actual formal payment plan.

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By Beancounting
13th Feb 2020 17:07

Yes you are correct in your assertion that HMRC have indicated that they are unwilling to enter into a formal TTP at this stage. Our client is proposing settling quite a substantial sum over about 24 months. He is thinking if he pays a couple of months before things progress, it is likely to make HMRC think twice

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Lisa Thomas
By Insolvency Practitioner
14th Feb 2020 09:11

Usually, if they have rejected a TTP then the only option they might consider (other than full payment) is a formal IVA proposal.

Has your client sought advice from an IP to see if an IVA would be viable?

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By bernard michael
14th Feb 2020 09:59

Has the client appointed a solicitor to oppose the Stat Demand ? Might be safer for you if he does otherwise you might get caught in any blame crossfire were he to act on your advice and it backfires

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