Verity
7th December 2009, 08:53
I am hoping someone can help me.
This is the situation. My husband worked as a contractor. We have a company set up of which he and i are the only 2 directors. The company paid him a salary and me a token salary for secretarial work. The majority of company earnings was paid to us as directors.
A few years ago my husband had a long period of unemployment and we continued to pay ourselves although the company had no money coming in as we needed to pay mortgage etc and knew he would get another contract before tax vat etc became due.
This meant that every year we were in fact playing catch up. We always paid all that was due out of the following years earnings.
Then disaster struck, in January my husband had a stroke. At that point we owed 30k in corporation tax and will soon owe personal tax too on the last ended year and further corp tax.
We do not have pensions but instead have about 50k in tessas peps isa etc. Because of our savings we do not qualify for benefits apart from £80 a week esa We have a 110k mortgage .
This year we have struggled to live on as little as possible. My husband now gets mid rate dla and mobility and I get carers allownace for him which means our income is altogether about £200 a week.
We need to move to a bungalow but can't as on moving would have to pay back mortgage and would not have enough capital left.
Our daughter is at college but cant get ema as it is based on earnings in last tax year.
So things are dire. Revenue have been in the loop virtually from day one as I had to default on the agreed schedule of repayments. They have said for us to repay at £100 a month until my husband restarts work. At first I thought he would recover and restart work. Nearly a year has gone by now and this is looking less likely. He is older than me at 62 and in the current job market its looking bleak.
I lie awake worrying about all the money we owe. We will need to sell our house when we run out of money and need somewhere with no stairs anyway. Will we have to pay the revenue from the proceeds of the house.
Although we did pay salaries and dividends to ourselves while owing tax we had always done this and although in hindsight this was incredibly stupid at the time it was a way to keep our heads above water and then it just continued. We never had any intent to defraud.
I just wish this would all go away. Should i close down the company I don't really want to as my husband is hoping he will get back into work. Its the only thing driving him to get better.
HMRC are happy with £100 a month atm but when I asked them at what point they would want repayment they were non commital.
I worry that i will suddenly get a phone call saying they want the whole lot back.
This is the situation. My husband worked as a contractor. We have a company set up of which he and i are the only 2 directors. The company paid him a salary and me a token salary for secretarial work. The majority of company earnings was paid to us as directors.
A few years ago my husband had a long period of unemployment and we continued to pay ourselves although the company had no money coming in as we needed to pay mortgage etc and knew he would get another contract before tax vat etc became due.
This meant that every year we were in fact playing catch up. We always paid all that was due out of the following years earnings.
Then disaster struck, in January my husband had a stroke. At that point we owed 30k in corporation tax and will soon owe personal tax too on the last ended year and further corp tax.
We do not have pensions but instead have about 50k in tessas peps isa etc. Because of our savings we do not qualify for benefits apart from £80 a week esa We have a 110k mortgage .
This year we have struggled to live on as little as possible. My husband now gets mid rate dla and mobility and I get carers allownace for him which means our income is altogether about £200 a week.
We need to move to a bungalow but can't as on moving would have to pay back mortgage and would not have enough capital left.
Our daughter is at college but cant get ema as it is based on earnings in last tax year.
So things are dire. Revenue have been in the loop virtually from day one as I had to default on the agreed schedule of repayments. They have said for us to repay at £100 a month until my husband restarts work. At first I thought he would recover and restart work. Nearly a year has gone by now and this is looking less likely. He is older than me at 62 and in the current job market its looking bleak.
I lie awake worrying about all the money we owe. We will need to sell our house when we run out of money and need somewhere with no stairs anyway. Will we have to pay the revenue from the proceeds of the house.
Although we did pay salaries and dividends to ourselves while owing tax we had always done this and although in hindsight this was incredibly stupid at the time it was a way to keep our heads above water and then it just continued. We never had any intent to defraud.
I just wish this would all go away. Should i close down the company I don't really want to as my husband is hoping he will get back into work. Its the only thing driving him to get better.
HMRC are happy with £100 a month atm but when I asked them at what point they would want repayment they were non commital.
I worry that i will suddenly get a phone call saying they want the whole lot back.