Our company cannot pay the Corporation Tax bill. What are my options?

Question

Our company corporation tax is overdue and I have already had a letter from HMRC threatening the company with penalties. We have been overdue before but sorted it within weeks. This time, however, it is a more serious matter as business has dropped off and we hadn’t budgeted for it. I have been told to seek the advice of an insolvency practitioner.

What are my options if the firm cannot pay its corporation tax? Can directors be liable? We don’t want to lose the business; it has been established 45 years and probably just needs some modern restructuring.

Answer

There are many options available to you from a time to pay (“TTP”) arrangement to a formal insolvency. One of our licensed insolvency practitioners will be able to help you by carrying out a financial review and identifying the problems you face, and more importantly the options open to you to mitigate the impact of those problems. The first thing is to carry out the financial review and then positive steps can be taken in the implementation of a rescue/recovery plan.

Ordinarily, in the absence of serious misconduct on the part of a director, limited liability means just that. However, if you are in any doubts about the way in which the company has been operated or money paid out we can also assist you in identifying any issues that you may face in the future, and forewarned is most certainly forearmed. Take the first positive step today and contact us to arrange an initial meeting, which won’t even cost you anything.