I have been approached by prospective client

There is a problem with his unfiled 2022/23 tax return

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He has told me that he shut down his Limited company bank account, PAYE scheme and dissolved the company on 31 December 2022. He has told me that the Limited company still owes £1,100 in PAYE because he submitted RTIs for January, February and March 2023. His 2022/23 tax return has not yet been filed. What needs to be done? Do I just ignore his salaries from January to March 2023 and the Income tax on them? If I put them on his return he will get a tax repayment of £950. He is now in business has a sole trader.

Replies (12)

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By Kosher
02nd Apr 2024 09:30

He filed three more months PAYE after he had shut the PAYE scheme down, closed the company's bank account and dissolved the company. He wants me to do his tax return for 2022/23. Would I be better refusing to act for him. I didn't post this yesterday because I thought the forum would think it was an April fool's joke.

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By bernard michael
02nd Apr 2024 09:42

Slight problem

You claim he shut down his PAYE scheme December 2022. How did he submit RTI's for the next 3 months??

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Replying to bernard michael:
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By Kosher
02nd Apr 2024 09:57

bernard michael wrote:

Slight problem

You claim he shut down his PAYE scheme December 2022. How did he submit RTI's for the next 3 months??

I am assuming he didn't shut down the scheme because he has not provided me with evidence. His limited company's accounts only shows his salary up to 31 December 2022.
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By Ruddles
02nd Apr 2024 09:50

Well, if the company was dissolved in December 2022 it can’t really have paid him a salary after that point, could it?

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Replying to Ruddles:
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By Kosher
02nd Apr 2024 10:04

I think that is the problem removed and I will only take his employment salary up to 31 December 2022. At that point there was no tax. I will file his 2023 tax return, which result in tax payable of £150. To do otherwise would be a tax fraud.

Since the company has been dissolved I am assuming my client won't be chased for underpaid PAYE of £1,100

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Replying to Ruddles:
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By Kosher
02nd Apr 2024 10:07

Ruddles wrote:

Well, if the company was dissolved in December 2022 it can’t really have paid him a salary after that point, could it?

Yes I already knew that but just wanted confirmation from another accountant. I am on my own now, after I parted company with my friend and colleague.
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By FactChecker
02nd Apr 2024 11:05

Two lots of "He has told me that .." shows that you believe his statements about as much as anyone else on here is likely to (namely not a lot)!

Personally, my natural instincts would be to refuse to engage any further (and most certainly not to engage formally until after evidence of these actions/filings had been provided and after substantial payment in advance).

The one thing worse than a mess ... is a mess where the facts keep changing due to the unreliability, or even dishonesty, of the client.

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Replying to FactChecker:
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By Kosher
02nd Apr 2024 11:49

Thank you, I am taking your advice and not setting him on. I am 71 and at my age don't need the extra stress.

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By frankfx
02nd Apr 2024 11:50

An observation.
Does client have a full NIC contribution record for 2022 23?
Do you advise on topic.?

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Replying to frankfx:
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By Kosher
02nd Apr 2024 12:09

frankfx wrote:

An observation.
Does client have a full NIC contribution record for 2022 23?
Do you advise on topic.?

Doesn't matter now because I am not setting him on.
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By paulwakefield1
02nd Apr 2024 12:55

I know you are not now taking him on but it has left me intrigued.

If he filed RTI's, where did the salary come from? Was it just going to be credited to a DLA even though the company didn't exist any more, were they sole trader drawings that he was treating as salary or was there still money in the bank account presumably belonging to the crown? It wouldn't be the first time that I've seen a bank account continuing to operate post dissolution

Or maybe he just filed RTIs because he didn't have a clue or maybe he didn't file anything at all and it is all a fiction.

So many questions and we'll never know!

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Replying to paulwakefield1:
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By Kosher
02nd Apr 2024 13:12

Neither will I, it is all once upon a time country and I can't be bothered.

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