HMRC Debt and Director Disqualification

Director Disqualification for HMRC Debt and Deliberate Neglect of VAT Affairs. 

In a recent press release the Insolvency Service confirm that Peter Addinall of Lincoln received a director disqualification period of 6 years for non payment of HMRC Debt and failing to ensure that the tax affairs of his company were in order. Non payment of HMRC Debt is usually grounds for director disqualification proceedings to be brought.

The Details of This Director Disqualification Case

Mr Addinall’s company, A.E.C. (Lincoln) Ltd (the ‘Company’), an electrical installation company, was placed into Creditors’ Voluntary Liquidation on 26 June 2013.  The Company’s Creditors were owed £186,218.00, of which the HMRC Debt element – VAT and PAYE combined – was £179,059.00.

After an investigation by the Insolvency Service, it was found that Mr Addinall had failed to ensure that the Company provided HMRC with immediate security of £105,532.00 failing which the Company would have to cease charging VAT. That security was not paid and VAT was continued to be charged, collected and not remitted on by the Company. According to the press release this amount was in excess of £10,000.00.

In addition the press release states that VAT returns were either not submitted at all or were submitted late. The VAT element owed at liquidation to HMRC is stated to be in the sum of £116,299.00.

Sue MacLeod, Chief Investigator of Insolvent Investigations, Midlands & West, at the Insolvency Service, commented:

‘Our investigation revealed Mr Addinall failed in his responsibilities as a director to deal with the company’s tax affairs. These abuses of the tax regime which impact on HMRC, other traders and customers alike, will not be tolerated.’

Act Quickly if you are Faced With Director Disqualification

Looking at the circumstances described in the press release it is perhaps unsurprising that the Secretary of State brought director disqualification proceedings when only £7,000.00 of the overall debt was not owed to HMRC. Non-payment of HMRC debt of this magnitude can be, and in our experience usually is, a ground for director disqualification proceedings to be brought.

As specialists in director disqualification, our team has acted both for and against the Insolvency Service, and has successfully defended many directors facing director disqualification. If you are facing director disqualification, n our experience it is always the case that the earlier that you get in touch with us the better.  That is because it is more likely that we can help you. Take a look at some of our case studies and testimonials in this area of law.

Please contact us or call us today on 0121 200 7040, or why not email a copy of the letter that you may have received from the Insolvency Service to us at law@ndandp.co.uk for a free no obligation/no pressure initial chat.

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