We are a ltd company set up in 2013 as a consultancy. Myself and husband as directors, no other staff, no assets (other than fairly old lap tops). We were advised to set our business up as a ltd company rather than sole trader at the time of incorporation. We filed our 17/18 accounts in 19 and our accountants worked out we owed £12k, we are still trying to pay off HMRC £18k from the previous year and could not understand why our bill was so high. It wasn’t until we queried it with the accountants this time, who told us because we’d been taking our money as a directors loan, we therefore have a much higher tax bill. We haven’t been advised by our accountants that we were unable to take money from the business in this way previously. We have obviously been very naive thinking we can just take money out like this. We now have got to a situation where we are paying HMRC £2k a month and £500 per month for corporation tax, which has been crippling us. My husband has now lost his only contract and we are left with these huge monthly payments to HMRC (we have already had 3 late payments on our mortgage and household bills to keep up with the HMRC payments) and a £10k overdraft on the business account. We have looked at the Spongebob plan but as our last books show, we have had just over £40k in directors loans. Am I right in thinking that if we implemented the SB Plan that HMRC will come after us to pay back the Directors Loans personally? How would we do that? We don’t want to not pay what we owe but we simply cannot afford these payments, especially with no work coming in from next month... We had a meeting with new accountants who have said that HMRC can come after us personally for tax owed if the company closed/went insolvent. They said they could work out a payment plan with HMRC for what we owe but the longest time they’ve ever negotiated time to pay back was 18 months. For the amount we owe I can’t see that time period being achievable. We have been very naive and buried our heads in the sand. This situation is causing many sleepless nights... Any advice would be much appreciated please.