Sterling Ford - Insolvency & Bankruptcy Services


   Tax Avoidance Schemes

Corporate
If your company has received a Follower Notice and/or an Accelerated Payment Notice and is unable to meet the tax and/or national insurance claimed by HMRC, you should contact Sterling Ford to discuss the options available.

Depending on whether your company is still trading, or was only incorporated for the specific purpose of participating in a tax avoidance scheme, perhaps several years ago, Sterling Ford will be able to advise you on the best options available.

What will happen to my company if it can't pay HMRC the tax demanded?

Where HMRC have already placed the tax out for collection, separate departments within HMRC and even individual divisions and teams in Counter-Avoidance may have different arrangements in place with specific external IP firms and solicitors, to pursue a recovery of tax due from the participating companies in particular avoidance schemes. If not paid in full, Revenue Solicitors would issue a petition to wind up the company concerned and where HMRC are the sole or majority creditor, they would seek the appointment of the IP firm for the compulsory liquidation that would ensue, who would in turn engage a specific firm of solicitors under the same block arrangement with HMRC. We have found that in such cases, the IP firm and solicitors used have not wasted any time in issuing proceedings to make a recovery for HMRC and other creditors, if any. In these cases, clams have been brought against the former directors, shareholders or other associates who benefitted directly or indirectly from the tax avoidance scheme. Such claims that may be brought against the beneficiaries of these schemes, include claims for breach of fiduciary duty, misfeasance etc. Successful claims have resulted in awards being made against or settlements made with such beneficiaries for the tax, penalties and interest and the legal costs incurred.

However, whilst in a number of these cases recoveries have been made, after the costs and delays incurred and the risk that the outcome may not have been successful, we are of the view that a risk assessed negotiated settlement can be a more efficient and cost effective way of achieving an acceptable outcome between parties.

The earlier Sterling Ford are consulted, the more cost effective the outcome can be. If your company has participated in a tax avoidance scheme and you wish to reach a settlement at least cost, call us today for a confidential consultation.

Sterling Ford's Approach Sterling Ford take a risk assessed approach to their negotiations in these matters to achieve settlements that both parties find acceptable.

Individuals
If you have received a Follower Notice and/or an Accelerated Payment Notice or a Regulation 80 notice and are unable to meet the tax and/or national insurance claimed by HMRC, you should contact Sterling Ford to discuss the options available.

Depending on whether you have a regular income and/or any assets, you would want to utilise what you have to your best advantage with a view to securing a full and final settlement with HMRC and any other creditors.

Disguised Remuneration Avoidance Schemes Warning to Employers and Employees- re EBTs, EFRBs and similar structures

In the Finance Bill 2017, legislation previously introduced in 2011 to enable HMRC to combat 'disguised remuneration' avoidance schemes is expected to be extended. For those companies whose employees received loans from an EBT (or similar structure) from 6 April 1999, they should obtain urgent advice on whether to repay such loans by 5 April 2019, or otherwise reach a settlement with HMRC in respect of the arrangement, in order to avoid the imposition of disguised remuneration charges or loan charges.

For employers - you may be facing accelerated payment notices in respect of the PAYE and NICs that HMRC consider to be due. Penalties and interest may also be payable.

For (former) employees - if your (former) employer can't or won't pay the PAYE and NICs due, HMRC may issue notices under Regulation 80 to make you personally liable to pay the PAYE and NICs at the applicable rates.

What should you do if you are caught by HMRC's anti-avoidance rules for disguised remuneration schemes

Take specialist tax advice on the options available. Action groups are being formed, which may or may not assist you and may be subject to joining/participation and other fees.

For those employers and employees who have already entered into settlement agreements with HMRC for loans made from 9 October 2010, but were previously involved in the same or similar schemes in any of the years from 6 April 1999, they could very well face further demands from HMRC and may wish to reassess their position in relation to the settlement agreements already in force or being negotiated, particularly if they are going to be unable to afford to enter into further settlement agreements in respect of earlier years.

If you cannot afford to pay the tax, penalties and interest, where applicable, contact Sterling Ford to learn how we may assist you in reaching a full and final settlement with HMRC based on what you can actually afford to pay, not on what they demand that you pay.

For a different perspective, call us now on 0808 171 2291 or complete our enquiry form.