Oh there is news but I don't know what it means for people
If you look at https://find-and-update.company-info...filing-history you will see that the firm has moved from Administration to Liquidation because that gives them more power to recover money from other sources.
Whether that impacts any contractors who were using the scheme is unknown mainly because while I've seen threats that contractors may need to pay back the loans I don't remember anyone being asked by a liquidator* to do so as HMRC are usually the largest creditor and are happy if the contractor has paid it directly.
* edit made because I temporarily forgot about the Felicitas claims (where the scheme organizers are the people trying to get the money).
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Reply to: Umbrella in administration
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Previously on "Umbrella in administration"
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Originally posted by bylren001 View PostHi guys. Has anyone had any updates on the Elite administration and interaction with HMRC. I am currently involved in a similar situation with a potential spin-off from Elite. Anyone actually managed to get them to write-off the loans? So far, HMRC has indicated it will do its best to recover the amounts from the Umbrella Company, but I feel like it will end up in the same situation as Elite. I dont understand how these UK-incorporated companies can keep pulling the scam repeatedly with no penalty against them. These guys should be put behind bars.
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Hi guys. Has anyone had any updates on the Elite administration and interaction with HMRC. I am currently involved in a similar situation with a potential spin-off from Elite. Anyone actually managed to get them to write-off the loans? So far, HMRC has indicated it will do its best to recover the amounts from the Umbrella Company, but I feel like it will end up in the same situation as Elite. I dont understand how these UK-incorporated companies can keep pulling the scam repeatedly with no penalty against them. These guys should be put behind bars.Last edited by bylren001; 17 April 2023, 13:11.
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Thanks all for the input. Well not positive reading especially on potential outcomes. I wonder how reasonable any administrators will be and if a deal to pay smaller % of the loan can be agreed. I guess just a case of waiting to see what will happen but looks likes another chunk of cash will be thrown down this endless pit!
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Originally posted by DealorNoDeal View Post
I wasn't referring to IHT. The OP thought paying back the loans would remove the (disguised remuneration) income tax liability. My understanding is it won't.
I've posted previously about Schrodinger money where multiple people look at it and see it as different things (taxable income / a loan) at the same time..Last edited by eek; 21 August 2022, 11:16.
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Originally posted by eek View Post
The question is not does the loan being written off solve an IHT issue - it's will the administrator chase those who have received "loans" to recover the debt owed by Elite to HMRC...
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More information on these types of umbrella in this thread in the Umbrella section:
https://forums.contractoruk.com/umbr...quidation.html
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Originally posted by DealorNoDeal View Post
I don't think that will work. My understanding is that the tax liability has already arisen, so paying back the loans now won't make any difference.
Followed by the second question - will the administrator
1) demand full payment from those with loans
2) ignore creditors who have paid HMRC
3) ignore the amount to HMRC but chase the rest
The simple fact is that we don't know enough to be able to answer any questions...
Last edited by eek; 21 August 2022, 10:52.
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Originally posted by DealorNoDeal View Post
I don't think that will work. My understanding is that the tax liability has already arisen, so paying back the loans now won't make any difference.
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Originally posted by laxinmo View PostAlmost feel like it would be better just to pay back the loans and avoid the tax liability than settle with HMRC as otherwise I could be in the ridiculous position of paying the tax liability on the “loans” and then paying back loans to HMRC creditors.
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Hi Eek
thank you for your reply. As I feared more uncertainty. No fortunately I was only naive enough to deal with elite but am aware of contractor care as they are named as creditors in Elites administration. Are there any similar previous case studies of umbrellas going into administration and how that played for contractors? Would you hedge any bets on the likely outcome of the loans? Almost feel like it would be better just to pay back the loans and avoid the tax liability than settle with HMRC as otherwise I could be in the ridiculous position of paying the tax liability on the “loans” and then paying back loans to HMRC creditors.
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Originally posted by laxinmo View PostHi everyone
Hoping for some advice from this life saving community!
I have nearly concluded my settlement process with HMRC with a final amount yet to pay. My umbrella was elite management and consultancy who in the last few weeks gone into administration with debt/tax liability of £20million to HMRC. Prior to this I had some contact with Elite but they would not entertain writing off any of my “loans”.
Wondering what to expect now? Feel like I’ve dealt with HMRC and tax liability but now have the other issue of what is going to happen to my loans. Is there a likelihood I will have to pay the loan amount back as creditors come knocking or is there potential it can still be written off? If it were to be written off will I be expected to pay more tax on it? Wondering if this could be another felicitas situation.
Cheers
elite (from memory) didn’t use trusts so it’s not a Felicitas type situation - that was a bunch of cowboys seeking a final payoff this is an administration with HMRC as a creditor so it’s different and it’s hard to say what will happen
by the way you weren’t transferred to contractor care or PAYEme were you? As both of them are now in HMRC’s sights as well..
Edit - based on https://forums.contractoruk.com/umbr...ml#post2565107 the scheme was via "Capital Investment" Payments
so contrived and won't work even though both PAYEme and Contractor care are arguing that the DOTAS SRN's they received recently are invalid - that marks a change as well the schemes used to market themselves as HMRC approved using their DOTAS SRN as proof.
Last edited by eek; 21 August 2022, 07:50.
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Umbrella in administration
Hi everyone
Hoping for some advice from this life saving community!
I have nearly concluded my settlement process with HMRC with a final amount yet to pay. My umbrella was elite management and consultancy who in the last few weeks gone into administration with debt/tax liability of £20million to HMRC. Prior to this I had some contact with Elite but they would not entertain writing off any of my “loans”.
Wondering what to expect now? Feel like I’ve dealt with HMRC and tax liability but now have the other issue of what is going to happen to my loans. Is there a likelihood I will have to pay the loan amount back as creditors come knocking or is there potential it can still be written off? If it were to be written off will I be expected to pay more tax on it? Wondering if this could be another felicitas situation.
Cheers
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