Insolvency Service Investigation - what to do?? please help

[WinterMuse]

I have yesterday received a letter and an email from 2 investigators from the insolvency service asking me to contact them to arrange a meeting. They are not telling me why but they are asking for 2 pages worth of bulletpoints (invoices, accounts, clients lists etc).
I am guessing their investigation was triggered by a complaint from a bailiff whom we owed £2500 after we lost a small claims court case and he couldnt find us at our registered address.

The problem is I have been incredibly reckless and careless and plain stupid and idiotic and I have not kept all invoices and things like that but the worst thing is I have never done my VAT returns (of which I think I will owe about £70,000) or the last 3 tax returns (I don't think I owe much tax as such but I have paid myself from the company maybe more than I should have done and didn't pay tax on that either).
I am absolutely terrified and although I know I am to blame and I probably deserve it I am so frightened they will pin me down for director misconduct and send me to prison.

Please can someone tell me what is my best option now?
Do I go to meet them and hold my hands up? Do I try and draft a plan showing how I could pay the debts over a certain amount of time and hope they will let me carry on and work for the next year for free - I am happy to do this.
Do I contact a private insolvency practitioner and let them do a voluntary liquidation? Would the insolvency service object to it on the grounds that the fee paid to the IP would better go to my creditors as they might decide to wind it up anyway?
I have about £17,000 cash in the bank,no assets and apart of HMRC debt probably owe about £40,000 to clients who have paid in advance for services.
Do I piss them off even more by going to a private IP or do I have a chance they will let the voluntary liquidation happen? Although I will still get a report at the end won't I and this no doubt will say director misconduct.
Or do I work with them but once I've given them the bank statements etc. I'm screwed.
I want to pay what I owe and I would do anything just not to go to prison, I've been up all night reading about cases where that happened and I am distraught.
please help!

 

[Ian J]

Is this a different company to the one that was dissolved that you were asking about last year?

 

[WinterMuse]

Hi Ian
Thanks for your response.
Yes it is a different company, it's been running for 3 and a half years.

 

[WinterMuse]

Can a CVA be arranged with the Insolvency Service with regards to the HMRC debt?

 

[UK Contractor Accountant]

The company is clearly insolvent and should not be trading - you should take the 'bull by the horn' and appoint a 'friendly' liquidator to wind the company up.

PM me if you want some recommendations.

 

[Lawyer James]

Appreciate that this will be a stressful time but try not to jump to conclusions when there is most probably a practical way in which this can be sorted out. I suggest that you send me a private message and I will put you in touch with an Insolvency Practitioner who should be able to assist quickly.

 

[Lisa Thomas]

Hi

There are a lot of points to consider here.

You need to cooperate with the Insolvency Service and hold your hands up. Prison isn't likely based on what you've said however disqualification and potential fines may be.

Neither the Insolvency Service nor HMRC will object to you instructing an IP - quite the opposite, this will be welcomed as you have a duty as a Director to mitigate the position and take steps to wind things down in an orderly fashion (If liquidation is the best route for the Company).

The Company is insolvent and you really need to take professional advice.

I'm a licensed IP - feel free to call me to chat things through in more detail.

 

[Opinion87]

You've mugged of HMRC for the last 9 months to the tune of £70,000~, and you've mugged off your own clients to the tune of £40,000~?

Throw your a**e in prison. £110,000 and apparently the second business you've run in to the ground. Ridiculous. You have to pass a test to drive, you should have to pass a test to start a company.

 

[MmmmDonuts]

This sort of response doesn't help anybody - somebody correct me it I'm wrong, but isn't this a forum for discussion and advice, not inflammatory statements or opinions like that?

I'm sure HMRC and any other creditors would rather see the OP work towards paying ££££££ than using the public purse to try gain a conviction.

So why don't you do everybody a favour and provide some insightful advice that could maybe help remedy the situation rather than spit out that kind of retort?

 

[ethical PR]

This sort of response doesn't help anybody - somebody correct me it I'm wrong, but isn't this a forum for discussion and advice, not inflammatory statements or opinions like that?

I'm sure HMRC and any other creditors would rather see the OP work towards paying ££££££ than using the public purse to try gain a conviction.

So why don't you do everybody a favour and provide some insightful advice that could maybe help remedy the situation rather than spit out that kind of retort?

Lisa and James have provided helpful advice. What do you feel would be additional insightful advice and a remedy in this situation ?

 

[The Byre]

You've mugged of HMRC for the last 9 months to the tune of £70,000~, and you've mugged off your own clients to the tune of £40,000~?
Throw your a**e in prison. £110,000 and apparently the second business you've run in to the ground. Ridiculous. You have to pass a test to drive, you should have to pass a test to start a company.

And I for one, agree.

This person has taken over £100,000 off others and we are supposed to feel pity and understanding? The hell I do!

I am guessing their investigation was triggered by a complaint from a bailiff whom we owed £2500 after we lost a small claims court case and he couldnt find us at our registered address.

So you did a runner and did not inform CH or the court of your new location.

The problem is I have been incredibly reckless and careless and plain stupid and idiotic and I have not kept all invoices and things like that but the worst thing is I have never done my VAT returns (of which I think I will owe about £70,000) or the last 3 tax returns (I don't think I owe much tax as such but I have paid myself from the company maybe more than I should have done and didn't pay tax on that either).

That is two or three instances of tax evasion.

I have about £17,000 cash in the bank,no assets and apart of HMRC debt probably owe about £40,000 to clients who have paid in advance for services.

And you took funds from customers in the knowledge that you would be totally incapable of fulfilling their orders.

If what you state is true, you have committed several criminal offences and almost certainly cause other individuals considerable distress. And according to what I read here, this is not the first time, so you are beginning to make a habit or career out of this behaviour. What exactly is society supposed to do with someone like you?

 

[Ian J]

This sort of response doesn't help anybody - somebody correct me it I'm wrong, but isn't this a forum for discussion and advice, not inflammatory statements or opinions like that?

I'm sure HMRC and any other creditors would rather see the OP work towards paying ££££££ than using the public purse to try gain a conviction.

I see by your own thread that you're also looking to shaft HMRC and one or two didn't like your approach on that thread either.

You do realise that if people like WinterMuse and yourself paid all the taxes that you were due to pay the rest of us wouldn't have to continue subsidizing you with our own taxes

 

[MmmmDonuts]

I see by your own thread that you're also looking to shaft HMRC and one or two didn't like your approach on that thread either.

You do realise that if people like WinterMuse and yourself paid all the taxes that you were due to pay the rest of us wouldn't have to continue subsidizing you with our own taxes

'Looking to shaft'.

This is exactly the retort I'm talking about. You're making assumptions about my position and using it to spit vitroil. I sought professional advice and have come to the understanding that the situation is not as serious as I thought, to stop worrying and deal with it properly.

What helps? Advice.

What doesn't? Bitter comments.

My point is, people are going to be turned away from this forum when when the 'clique' mentality sets in- they might come back with a bag of popcorn to see what petty arguments are taking place, but it will lose credibility as a resource of knowledge and advice.

I've seen it happen before.

Ps, stick that in your pipe and smoke it, grandad (...is probably your preferred response?).

 

[MmmmDonuts]

Lisa and James have provided helpful advice. What do you feel would be additional insightful advice and a remedy in this situation ?

I wish I could help with some advice, but I'm learning the hard way too and yes, Lisa and James have responded far more constructively.

 

[MmmmDonuts]

Posted: Apr 21, 2016 By: Opinion87 Member since: Jul 1, 2015 Report this post

You've mugged of HMRC for the last 9 months to the tune of £70,000~, and you've mugged off your own clients to the tune of £40,000~?

He said he owes services to clients who have paid in advance.

 

[Ian J]

'Looking to shaft'.

This is exactly the retort I'm talking about. You're making assumptions about my position and using it to spit vitroil. I sought professional advice and have come to the understanding that the situation is not as serious as I thought, to stop worrying and deal with it properly.

According to your post you were paid for two years into your company but have failed to pay any income tax on your earnings and are now hoping that "Companies House will just strike it off so that you can start afresh"

I stand by my quote that you seem to be looking to shaft HMRC

I didn't post anything to your thread as I had nothing useful to add but am posting here not in response to the OP's questions but to your attack on anyone who had the temerity to show disappointment that the OP screwed everyone in sight.

Personally I think that anyone that can't differentiate between their customers' money and their own deserves to have the book thrown at them but that's by the by

 

[MmmmDonuts]

I didn't post anything to your thread as I had nothing useful to add but am posting here not in response to the OP's questions but to your attack on anyone who had the temerity to show disappointment that the OP screwed everyone in sight.

Again, here you go: 'show disappointment'.

Really?

My advice to the OP is to seek proper advice if you can't get any help on here.

I was in a similar panic-stricken situation, but discovered it's not as severe as I thought which meant I could deal with it with a level head and not emotionally. I thought I owed way more than what I did which made me think there was no other way out.

The first thing OP should do is get somebody in who isn't emotionally involved and can help assess the situation with facts and figures. He might not even have anywhere near a £70k VAT bill and could be worrying unnecessarily.

If he's still able to carry out the services pre-paid by his clients, then 'he's mugged them off' is another caustic comment that can be ignored. Maybe he used those upfront funds to assist in being able to perform that service in the future, who knows?

We're assuming too much here and some are too quick to judge and criticise.

 

[Ian J]

We're assuming too much here and some are too quick to judge and criticise.

No-one is assuming anything as all responses in both threads were based on the figures supplied by the OP in this thread and yourself in your thread and if your figures were wrong that's hardly our fault

 

[Pish_Pash]

It's quite a revelation dropping in now & again on his sub-forum ....most asking for help round these parts have had a hooley at the taxpayers' expense (i.e. spent the VAT like it's their money) & then afterwards preface it all by saying "I'm an idiot" (& it seems this line of defence is quite acceptable to some round these parts)....I'm with Opinion87 & the Byre......"escort him to his cell...."

 

[Ian J]

I'm with Opinion87 & the Byre......"escort him to his cell...."

Him is a her