Help, advanced finding charge! What do I do!

[WorkingMum23]

Hi,
My business isn't trading and hasn't for a long time I'm now a full time carer for my disabled son. The only money I've had is my maternity pay. My accountant deals with all that I simply don't understand any of it. My business is due to officially be closed this year (I'm not trading I mean officially close with HMRC) anyway, I found out yesterday through HMRC that there is a advanced funding charge of £3600 on my business! They say it's something my accountant hasn't done or something like that? What is this please and what has my accountant done? I mean surely I'm not liable for this I didn't do anything and I don't even understand it! I'm so stressed not eating or sleeping I can't cope with this I'm a carer for my child. What can be done. Please help!

 

[Scalloway]

Are you a sole trader or do you have a limited company?

 

[WorkingMum23]

Are you a sole trader or do you have a limited company?

Ltd company

 

[Scalloway]

Then it is possible that the limited company is due to pay the debt. If that is the case then you are not personally liable.

Has the company been paying you Maternity Pay?

 

[WorkingMum23]

Then it is possible that the limited company is due to pay the debt. If that is the case then you are not personally liable.

Has the company been paying you Maternity Pay?

Ok, what does my accountant do to sort this out please? My business has no money I'm not trading so there is £0 in there. Can I due my accountant for this?

 

[Scalloway]

If the company has debts but no money then it is insolvent. Your only option is to have the company dissolved. There is a fee of £10. HMRC will object but will do nothing further and the company will eventually die and the debt will die with it. You have nothing to worry about.

There is a thread on the process here.

CLOSING A LIMITED COMPANY WTH INSUFFICIENT FUNDS WITH WHICH TO PAY AN INSOLVENCY PRACTITIONER

CLOSING AN INSOLVENT LIMITED COMPANY WITH INSUFFICIENT FUNDS WITH WHICH TO PAY AN INSOLVENCY PRACTITIONER If a company is unable to carry on trading due to becoming insolvent the standard procedure for closing it down is for the directors to appoint an Insolvency Practitioner to liquidate it...

www.ukbusinessforums.co.uk

 

[WorkingMum23]

Ok, what does my accountant do to sort this out please? My business has no money I'm not trading so there is £0 in there. Can I due my accountant for this?

Yes HMRC paid my business i then took it out as my matternity pay.

 

[WaveJumper]

How are you paying your accountant if your business has no money

 

[paulears]

Forgive me, but are you paying this accountant? It’s fine not to be savvy with these things, but presumably all the maternity stuff was arranged by him? If you are getting maternity pay through your business, closing it will close your income stream wont it? If you lose the maternity pay, because you are unemployed when the business shuts, you’ll need alternate benefits wont you?

 

[WorkingMum23]

How are you paying your accountant if your business has no money

He's a family friend and my dad paid off his last bill

 

[WorkingMum23]

Forgive me, but are you paying this accountant? It’s fine not to be savvy with these things, but presumably all the maternity stuff was arranged by him? If you are getting maternity pay through your business, closing it will close your income stream wont it? If you lose the maternity pay, because you are unemployed when the business shuts, you’ll need alternate benefits wont you?

He's a family friend and my dad paid his last bill. I will soon get disability and carers allowance

 

[Mark T Jones]

He's a family friend and my dad paid off his last bill

To be clear here, as a company director 'not having a clue' isn't a valid excuse, you have a responsibility to be on top of these things.

You can of course pay professionals and pass the authority on to them, but it still remains your ultimate responsibility

In this case, the get-out is relatively easy and painless as per @Scalloway post - you can potentially ask your accountant friend for one last favour?

 

[WorkingMum23]

To be clear here, as a company director 'not having a clue' isn't a valid excuse, you have a responsibility to be on top of these things.

You can of course pay professionals and pass the authority on to them, but it still remains your ultimate responsibility

In this case, the get-out is relatively easy and painless as per @Scalloway post - you can potentially ask your accountant friend for one last favour?

In normal circumstances I agree but the whole reason I got a accountant in the first place was to help me understand these things. I am not an accountant I do not understand how to apply for matternity pay or what the processes are, it is his job. When I was working I always paid him and any tax immediately. This is not a tax debt it's an advanced funding charge - which is solely down to my accountant not doing something correctly so I don't see how that is my fault. When I spoke to HMRC they didn't say to me it's down to me to sort out they said speak to your accountant and get them to sort this out.

 

[Mark T Jones]

In normal circumstances I agree but the whole reason I got a accountant in the first place was to help me understand these things. I am not an accountant I do not understand how to apply for matternity pay or what the processes are, it is his job. When I was working I always paid him and any tax immediately. This is not a tax debt it's an advanced funding charge - which is solely down to my accountant not doing something correctly so I don't see how that is my fault. When I spoke to HMRC they didn't say to me it's down to me to sort out they said speak to your accountant and get them to sort this out.

HMRC correctly pointed you to your accountant, and if they haven't done their job correctly you can potentially claim against their PI cover.

But legally, as the director of the business the buck stops with you - this is an important point that ALL business owners must understand.

Again,vypu have a simple get out here, so the above shouldn't be necessary

 

[UKSBD]

Yes HMRC paid my business i then took it out as my matternity pay.

I think you need to find out how much HMRC paid your business and what exactly this payment was for.

 

[Newchodge]

It could be that, when you went on maternity leave the accountant claimed, for the Ltd company, the total amount of maternity pay you were to be paid, in advance, from HMRC. If you haven't had payroll running properly and showing the maternity pay you received, that might result in this - HMRC thinks the maternity funding paid to your company has not been paid to the employee (you).

 

[DWS]

Agree with Newchodge, HMRC would have paid the advanced amount to cover the whole of your maternity period, this then needs to be paid to you though RTI on the normal monthly/weekly payroll for the duration.
You need to check the payroll is still being submitted to HMRC, it should not have been paid to you in one amount.