Reply to: Limited Company Struck Off - Corporation Tax Question

[richto]

I had to phoenix a company due to being ridiculously dicked by an agency. Owed 38k Corp tax, which wasn't contested by Hector.

Ditto - £35K of VAT. 'Forgot' to return annual returns and Companies House struck it off within a few months.

[Old Hack]

Yes it is.

If a company ceases trading because the business went tits up then you can quite legally phoenix the company, take the good bits and continue trading the next day. It's a pretty bad situation for your creditors but quite often that's the way businesses work. So long as you are not trading fraudulently (eg, deliberately bankrupting the company or paying some creditors while the other others get nothing), or doing it systematically, there is little anyone can do about it too. That's the way business works.

I had to phoenix a company due to being ridiculously dicked by an agency. Owed 38k Corp tax, which wasn't contested by Hector.

[Wanderer]

I was intrigued by this, because if the debt cannot somehow be satisfied by action against the former directors it would be pretty easy to go on a fiddling spree (perhaps it is).

Yes it is.

If a company ceases trading because the business went tits up then you can quite legally phoenix the company, take the good bits and continue trading the next day. It's a pretty bad situation for your creditors but quite often that's the way businesses work. So long as you are not trading fraudulently (eg, deliberately bankrupting the company or paying some creditors while the other others get nothing), or doing it systematically, there is little anyone can do about it too. That's the way business works.

[ASB]

My old company was struck off in 2002 by companies house - no accounts completed and I think corp tax owing about £7k. HMRC didn't contest closure.



Tone

Tone,

Not a problem,provided HMRC were notified (and this can be established) then it is their responsibility to contest. They didn't and were therefore happy. Tough on them.

I am assuming though that you didn't go for ESC 16 clearance because there was no need to take the remaining funds (including their CT) as capital?

In this case part of the undertaking is that you would pay all outstanding monies due to HMRC. If you were in breach of this then, even though they didn't object to the striking off, they would have the right to come after it from you personally.

Since you haven't heard anything for 10 years their prospect of success would be fairly small; indeed it is probably time expired after 6 years anyway.

[Sands of Time]

My old company was struck off in 2002 by companies house - no accounts completed and I think corp tax owing about £7k. HMRC didn't contest closure.



Tone

[ASB]

There's something nagging at me that if a company is struck off wrongly (ie, with creditors), then the debts can be transferred to the directors. Before a striking off can take place, the company is required to send a notice to creditors of their intention. I suspect that this notice has not been sent to HMRC and therefore there could be repercussions. But i might be wrong - I'm going on memory here.

I was intrigued by this, because if the debt cannot somehow be satisfied by action against the former directors it would be pretty easy to go on a fiddling spree (perhaps it is).


Not notifying interested parties (e.g. creditors) within 7 days of submission of the 652a is a criminal offence. £5k, 15 years disqualification.

I cannot find a specific method of transferring the debts to the director(s) however there must be one. The creditors have suffered loss as a result of the criminal action and would have redress through the civil courts.

[Alan @ BroomeAffinity]

There's something nagging at me that if a company is struck off wrongly (ie, with creditors), then the debts can be transferred to the directors. Before a striking off can take place, the company is required to send a notice to creditors of their intention. I suspect that this notice has not been sent to HMRC and therefore there could be repercussions. But i might be wrong - I'm going on memory here.

[tractor]

...

"You" don't owe any CT, and never did. The company of which your were a director might have owed CT, but that company no longer exists. End of story. Contrary to earlier replies, HMRC can and do sometimes ignore a striking off notice even when there is tax owing.

Just one thing though, when you say you have "set aside" money for the CT, do you mean your own money or company money? If company money then that now belongs to the treasury and you have no right to do anything with it other than surrender it.

Yep. Look up bona vacantia and the Treasury Solicitor. I hope you emptied the co accts before the 3 months was up

[Yehudi]

"You" don't owe any CT, and never did. The company of which your were a director might have owed CT, but that company no longer exists. End of story. Contrary to earlier replies, HMRC can and do sometimes ignore a striking off notice even when there is tax owing.

Just one thing though, when you say you have "set aside" money for the CT, do you mean your own money or company money? If company money then that now belongs to the treasury and you have no right to do anything with it other than surrender it.

[Bumfluff]

No, they are not based in Leeds. Why do you ask?

search form for Darren Upton, Upton accountant, dude is now doing time in prison and servicing new clients In nut shell he modified clients accounts to get refunds of CT, so it looked like nothing was outstanding when it was. I don't think this is you though as you hadnt even paid the CT then so nothing for him to try and claim back.

I would just check your closing accounts and see if there is CT due on there if there isn't and you expect there to be ask your accountant why.

[Bumfluff]

Your accountant wasn't in Leeds was he??

Wakefield but now residing at HMP

[Crackers]

No, they are not based in Leeds. Why do you ask?

[northernladuk]

Your accountant wasn't in Leeds was he??

[Craig@Clarity]

You should have signed off the final closure accounts that your old accountant prepared along with the final corporation tax return. My guess is to then check your bank statements to locate the payment or confirm with HMRC what the last corporation tax paid was. They should match to the corporation tax return amount which would confirm everything was up to date.

Unless your old accountants never submitted your final accounts to HMRC and managed to strike off your company before any deadlines reached with HMRC, it's unlikely that HMRC would have allowed the company to be struck off at companies house.

First people to normally object to a striking off at companies house is HMRC for unpaid taxes. The fact that your company has been struck would indicate everything was up to date (disclaimer - although there are the odd few that slip under the radar). Best thing to do is to follow my first paragraph to confirm everything is up to date.

Hope that helps!

[Crackers]

Plus wouldn't HMRC or Companies House check all this before striking it off?