Limited company, hmrc help

[winston the boxer dog]

Hi

Just found this great site as ive been trying to get some advice to my current situation/problem, and cant take the stress of it all so need some answers if possible.

Right 2006 started my own limited company installing electronic security systems now my first year was great and made around 35k and payed mmy way in terms of paye and corporation tax owed, now late into my second year I encountered serious problems in terms of lack of work and in turn could meet my corporation tax bill as I pumped it back through business in wages and to keep the business running into its third year hoping it would pick up.

Now fell behind with morgage, bills etc due to the above and soo so close to losing my home now I plodded along for a while until late 2009 when I closed my business bank account and decided to look for a job which took me until march 2010 to find. now Im getting letters from inland revenue still regarding a 2500 corporation tax bill, I also owe the same in paye and at my wits end with it all. going to see my accountant next week in reaged of accounts leading to when business closed. and tbh my accountant is no use and not much help so dreading talking to him.

Now I have phoned the inland revenue spoke to people written letters but again on friday got another letter in demanding the bill. just sick of it all and no one seems to correspond with the times I have phoned and letters sent.

So going to phone them again tomorrow and do it all over again, but I didnt realise I had to close company through companies house and I sent a letter to them and just sent of a form yesterday that I recieved from companies house. the company doesnt have a office its based at my mum and dads house the vehicle I had was leased aslo.

where do I go fro here and help would go along way.

thanks

[kontracta_com]

I fear that I may be of no help here (sorry not trying to inflame the situation) but telling as many people who may be able to provide some help, keeping in dialogue with everyone and even trying the CAB may be the best options.

I'm guessing you've already looked but the HMRC have guidance on if you are having problems - unf I can't post the link due to my stataus on here but go to HMRC site-Corporation Tax-Paying Corp Tax and Help If You Can't pay. I hope that they are able to help - after all it is in their interest to make arrangements for getting full payment eventually rather than pulling the rug from under you.

The Citizens Advice Bureau may be of very little help but it is always an option.

Despite your fears, your accountant should at least be able to provide you with options. If you need a second opinion, then it may be worth getting one with either another accountant or even a solicitor. I wouldn't want to start talking about administration or voluntary liquidation routes as I don't know enough about your situation to proffer an opinion - but your accountant should be able to help. Get him or her on your side to help too - the extra fees payable now could mean a lot less in terms of costs and hassle in the long run.

The main thing is though is to keep up dialogue with as many people as possible and keep records of notes from meetings and 'phone conversations. Even if you think you may be wasting your time.

Finally good luck with everything and hope it gets sorted out without denting your business confidence.

[BudgetB]

Horrible situation to be in, can sympathise.

As it's a Ltd Co, I would seriously suggest talking to a good insolvency practitioner as you may be able to deal with the tax debts that way.

With regard to your personal situation, as the poster above says, keep in touch with everyone, see CAB or one of the reputable online advice sites, use their template letters and forms to agree payment plans with people. Make sure you are in communication with your mortgage company, most will be understanding of people in genuine trouble. Once you have the beginnings of a plan the stress does start to reduce.

[KM-Tiger]

... 2006 started my own limited company

If it's a Ltd Co then it's the company that owes money and not you. That's the whole point of a Ltd Co. Do not feel obliged to pay the Ltd Co's debts, you do not have to, and should not.

If the company has no assets and no cash then it cannot pay and quite likely HMRC will instigate the process of winding the company up, once you have told them that it has ceased trading.

Do a search in this forum for posts by 'spongebob' who has given lots of excellent advice on what to do in this kind of situation. Once you have got an understanding of what to do, the stress should be relieved.

[Spongebob]

I would seriously suggest talking to a good insolvency practitioner as you may be able to deal with the tax debts that way.

:eek::eek::eek::eek::eek::eek::eek:

That is the very last thing you should do!

KM Tiger is quite right in that you do not owe anybody any money; the company does. A limited company's legal status is akin to that of an individual person - think of the company as a separate person to yourself and you won't go far wrong.

It is the company which has ceased trading - not you.
It is the company which owes money to HMRC - not you.
It is the company who will be chased through the courts - not you.

Write as a director of the company to all creditors, including HMRC, explaining that the company has ceased trading due to becoming insolvent. Add that the company has no assets or money with which to pay an insolvency practitioner to liquidate the company and that the company will lie in limbo until a creditor initiates winding-up proceedings.

Then just wait, while you get on with your life. In all probability nothing much will happen for months; you may get the odd standard letter from HMRC chasing the debt but these can safely be ignored. You may get a county court summons from HMRC - again, ignore it. Remember that they are chasing somebody else - the company!

It is possible that having got a county court judgement against the company that a bailiff may visit the company's address. You mention your parents house, was this the trading address or the registered office? Either way, you should warn your parents of the possibility of a visit from a bailiff some time in the future and reassure them that it is absolutely nothing to worry about. The only things a bailiff can take possession of are assets of the company - not anybody else's property.

Eventually HMRC will initiate winding up proceedings against the company, leading to it being wound up in the High Court. You should ignore all correspondence relating to this.

Once wound up, the company will be placed in the hands of the Official Receiver who will conduct the liquidation process. This will involve you attending an interview at your local OR office where you will be asked to explain the reasons for the insolvency of the company.

And that's it!

Total cost to yourself - a bus ticket to the OR office.

[winston the boxer dog]

Thanks very much for the replys guys, cant thak yous enough, I will follow that spongbob it has took a bit of weight off my mind reading this.

Im back earning money doing a 9-5 in a job I hate with the past hanging over me from the business failure which is bad enough, HMRC gave me a bit of a ass kicking on the phone the other day.

[Spongebob]

HMRC gave me a bit of a ass kicking on the phone the other day.

That puzzles me a little. I can't remember ever speaking to HMRC on the phone!

Did you call them or did they call you? If the former, don't do it again; if the latter and they call back, simply explain politely that the company has ceased trading and has no assets. Then hang up. If they are calling you on your mobile I would seriously consider changing my number.

I reiterate; you do not owe them a penny. The company does!

The company now exists in name only and they can take whatever action they like against it - you are untouchable. Do not allow yourself to get into any discussions or conversations with HMRC other than repeating the mantra "The company has ceased trading and has no assets."

You've just got to tough it out. The day the winding up petition lands on your doormat is the day you know that you've made it!

Good luck.

Bob


PS Re: the job you hate.

Be more positive and throw yourself into it; If you still hate it after another 6 months look for something else. There is nothing to stop you starting up again installing security systems either as a sole trader or as a new limited company. I take it that you have managed to hang onto all your tools...

[winston the boxer dog]

Hey spongbob

I phoned them as they wrote me another letter, yeah Im with another large company doing what I did as my business, but Its just that way my hearts not in it, been doing it all in 14 years now. Strange you say throw your self into it the other half said the same thing about that to me this morning lol as I was doing my usual moaning :rolleyes:

Tools wise still have my drill machines 2 of and my ladders and steps the company I work for supplys all that so I have that in my shed still

thanks

[Batra Ventures UK Limited]

Hey spongbob

I phoned them as they wrote me another letter, yeah Im with another large company doing what I did as my business, but Its just that way my hearts not in it, been doing it all in 14 years now. Strange you say throw your self into it the other half said the same thing about that to me this morning lol as I was doing my usual moaning :rolleyes:

Tools wise still have my drill machines 2 of and my ladders and steps the company I work for supplys all that so I have that in my shed still

thanks

I may be wrong but I wouldnt advertise "tools" to anybody, its not a property or a company car or van. Spongbob is spot on.

I would use the money to cover the mortgage arrears and then show my sexy finger to HMRC.