Outstanding invoices due - but company has closed?

[pushingpixels]

I am in the unfortunate position of chasing some outstanding invoices that *may* eventually be paid. However for reasons I won't go into I need to close my company down. So this raises (for me at least) a couple of questions:

1) If I close the company down - can the invoices (if they are eventually paid) be paid to me personally (a director) as the company will no longer exist - or can they only be paid to the company?

2) If am due to pay Corporation Tax later in the year (say Dec), can I close the company down now and still pay this in Dec from a personal account, or does the fact that Corporation Tax is paid out of the company accounts mean it has to be paid *first* before the company can close?

Any help much appreciated.


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[malvolio]

I am in the unfortunate position of chasing some outstanding invoices that *may* eventually be paid. However for reasons I won't go into I need to close my company down. So this raises (for me at least) a couple of questions:

1) If I close the company down - can the invoices (if they are eventually paid) be paid to me personally (a director) as the company will no longer exist - or can they only be paid to the company?

2) If am due to pay Corporation Tax later in the year (say Dec), can I close the company down now and still pay this in Dec from a personal account, or does the fact that Corporation Tax is paid out of the company accounts mean it has to be paid *first* before the company can close?

Any help much appreciated.


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No doubt an accountant will render a more detailed answer, but you can't close a company until all debts - including CT - have been paid. And closing a company with monies owing to it is fundamentally silly on several levels.

So let's go back to question one - why do you "have" to close down now?

[Jessica@WhiteFieldTax]

1. In theory they can be assigned, but it merely gives the debtor more of an excuse not to pay, and makes enforcement difficult if they don't pay.

2. HMRC will require CT to be paid before a strike off or liquidation can be finalised.

[pushingpixels]

1. In theory they can be assigned,

Ok - how do go about getting them 'assigned' - is this a technical thing an accountant does (I'm assuming so)?

[SueEllen]

Ok - how do go about getting them 'assigned' - is this a technical thing an accountant does (I'm assuming so)?

No you just tell the other party in writing that party x now has brought the assets of party y.

However:
1. Some contracts forbid the assignment of debts,
2. Even if you can assign debts it can cause other contract issues as not everything can be assigned.

You are aware that you can appoint someone else you know and trust to be a director of your company if you can't be one? And a director isn't the same as a shareholder?

[pushingpixels]

You are aware that you can appoint someone else you know and trust to be a director of your company if you can't be one? And a director isn't the same as a shareholder?

I'm still Director - I thought by closing the company I could force the payment of outstanding invoices through some other medium than the company. I'm trying to avoid putting the (have to say well-earned) invoices through the company (think ex-spouse).

Oh well!

[northernladuk]

I'm still Director - I thought by closing the company I could force the payment of outstanding invoices through some other medium than the company. I'm trying to avoid putting the (have to say well-earned) invoices through the company (think ex-spouse).

Oh well!

If that is the case you need better advice than ours. Putting invoices through some other medium means some other form of tax will have to be paid and it won't be at the rates you can as a company. Most agents and clients won't trade with sole traders and I shouldn't think they will be too happy paying it to a named person when they are contracted to a company either.

[IR35FanClub]

I'm still Director - I thought by closing the company I could force the payment of outstanding invoices through some other medium than the company. I'm trying to avoid putting the (have to say well-earned) invoices through the company (think ex-spouse).

Oh well!

Your ex spouses lawyers will have you if you try this. They know what you were invoicing and if you try and hide it, will come after you. Its also contempt of court which can land you in prison. Some rich bloke last year ihad this happen though iirc it was after being asked by the judge he failed to cooperate. Best to get over the fact that you will be handing large sums over to your ex. And if its to avoid child maintenance and not matrmonial payments.. shame on you. Me and my ex hate each other, but somehow we can still negotiate successfully on child maintenance payments based on what it costs to look after him, not what the CSA says. I pay more than the CSA require ie more than 15% and thats of a contracting income!