Company cessation with outstanding corporation tax.

Discussion in 'Accounts & Finance' started by BigVern, Dec 8, 2018 at 7:20 AM.

  1. BigVern

    BigVern UKBF Newcomer Free Member

    3 0
    I was a 1 man lto company, contracting my engineering services to a maintenance business.

    After finishing the contract in May 18, I had my final accounts prepared and applied to close my company. Companies house informed me that an objection had been raised by HMRC, to the closure, probably due to the outstanding Corporation Tax bill (£6,0000 ish).

    I have now received a letter from Companies House, stating that my company is now dissolved.

    I have not paid the final Corporation Tax bill.

    The business bank account is empty and closed.

    QUESTIONS:

    Should I pay the outstanding Corporation Tax bill?

    What will happen if I ignore the bill, am I personally liable, as the ex-director?

    Any thoughts/advice would be very much appreciated.
     
    Posted: Dec 8, 2018 at 7:20 AM By: BigVern Member since: Dec 8, 2018
    #1
  2. Scalloway

    Scalloway UKBF Legend Free Member

    14,037 2,993
    If you the last set of accounts filed showed you owed money to the company HMRC will expect you to pay tax on the sum you have taken out.
     
    Posted: Dec 8, 2018 at 9:21 AM By: Scalloway Member since: Jun 6, 2010
    #2
  3. BigVern

    BigVern UKBF Newcomer Free Member

    3 0
    Thanks for that.
     
    Posted: Dec 8, 2018 at 10:12 AM By: BigVern Member since: Dec 8, 2018
    #3
  4. Blaby Loyal

    Blaby Loyal UKBF Enthusiast Free Member

    549 107
    If the amount owed to HMRC was in respect of Corporation Tax then that was the company's liability to HMRC and not your personal liability.

    Your personal liability will extend to only those items for which you are personally taxable.

    As such, the £6,000 'died' when the company was dissolved. It is very,very unlikely that HMRC would restore a company for that level of debt.
     
    Posted: Dec 8, 2018 at 3:26 PM By: Blaby Loyal Member since: Jun 12, 2018
    #4
  5. BigVern

    BigVern UKBF Newcomer Free Member

    3 0
    What should I do then, just ignore the outstanding bill?
     
    Posted: Dec 8, 2018 at 4:06 PM By: BigVern Member since: Dec 8, 2018
    #5
  6. Blaby Loyal

    Blaby Loyal UKBF Enthusiast Free Member

    549 107
    If the Notice to Pay from HMRC is in the name of the limited company then, as the company has been dissolved, it has no legal status any more and there is no obligation that I am aware of which would require the former directors to pay the dissolved company's creditors.

    So, yes, ignore it. You can inform HMRC that the company has been dissolved but you are under no obligation to do so: it's probably best to let sleeping dogs lie. If HMRC think they are on to something then they'll let you know soon enough but for £6,000 I very much doubt it.
     
    Posted: Dec 8, 2018 at 4:31 PM By: Blaby Loyal Member since: Jun 12, 2018
    #6
  7. Lisa Thomas

    Lisa Thomas UKBF Enthusiast Free Member

    2,451 295
    Yes ignore as the Company which owes the debt has died.

    But... beware the very (very) slim chance that HMRC could resurrect the Company and Liquidate it.

    The Lqr could then pursue you for any DLA etc that you owe.
     
    Posted: Dec 11, 2018 at 11:35 AM By: Lisa Thomas Member since: Apr 20, 2015
    #7
  8. Blaby Loyal

    Blaby Loyal UKBF Enthusiast Free Member

    549 107
    *Lqr = Liquidator

    *DLA = Director's Loan Account
     
    Posted: Dec 11, 2018 at 12:02 PM By: Blaby Loyal Member since: Jun 12, 2018
    #8