Big Big Big debt owed in tax.

davethetaller

I am trying to find a way forward for a friend of mine,who over the last 15 years or so,being self employed,has paid no tax or nat.insurance stamps.

Without me dressing it up,he has received a letter from the tax people,noting that they have not received a return from him since the year dot.

They are asking for £80,000 which is not far off the mark.He also has credit card debts of £25,000.

He is aware that he has been reckless;and if the Revenue make him bankrupt,will the fact that he served a 6 month spell,at one of her majesties hotels, for insurance fraud approx 10 years ago,make the penalty worse?

He does not have anything of value,no bank account,lives in a B/B,and his age is against him as he gets close to retirement(with no pension)!!!

So there we have it,...in the spirit of this forum, where I am not looking for sympathy for him,...what should be his course of action,and dare I ask;his likely penalty? Many thanks in anticipation.

tigerfeet2006

Sorry I am not sure what to say to you about this but I would suggest proably contacting one of the debt charities listed in my signature. There is sure to be someone along soon with a bit more knowledge to help.

Hope you manage to get things sorted for him soon.

fiveyearplan

I agree with tigerfeet, contact one of the charities. It is worth noting that they are obliged to report any fraud but you haven't mentioned that he has recently done anything fraudulent - just forewarning in case! Please don't be offended.

rog2

The fact that he has 'spent time' in prison should mean that he has 'paid for' his previous crime. Depending on how long ago this was, I wouldn't think that it would make any difference to his bankruptcy, other than the possible imposition of a BRO (Bankruptcy Restriction Order) effectively extending his bankruptcy restrictions beyond his discharge date.
This is, I hasten to add, only my opinion as HMRC COULD choose to go for a criminal offence, such as Tax Avoidance, rather than bankruptcy.
Your friend would benefit from talking to one of the Debt Charities, and, possibly, a solicitor.

davethetaller

fiveyearplan wrote: »

I agree with tigerfeet, contact one of the charities. It is worth noting that they are obliged to report any fraud but you haven't mentioned that he has recently done anything fraudulent - just forewarning in case! Please don't be offended.

Many thanks for your replies fiveyearplan and tigerfeet2006, he has not done anything fraudulent recently so I suppose there is hope! You both point me in the direction of the charities,which I am sure is good advice.

What I am hoping for, is that someone with a similar level of (Revenue)debt,will post any tips or advice.Dare I ask,...will they b/rupt him,or is he likely to be out of circulation for a period of time?

rog2

HMRC declared me bankrupt for an 'alleged' debt of £74k, including penalty charges - I was made bankrupt Last October and got early discharge in April of this year. I am still in circulation.

davethetaller

rog2 wrote: »

The fact that he has 'spent time' in prison should mean that he has 'paid for' his previous crime. Depending on how long ago this was, I wouldn't think that it would make any difference to his bankruptcy, other than the possible imposition of a BRO (Bankruptcy Restriction Order) effectively extending his bankruptcy restrictions beyond his discharge date.
This is, I hasten to add, only my opinion as HMRC COULD choose to go for a criminal offence, such as Tax Avoidance, rather than bankruptcy.
Your friend would benefit from talking to one of the Debt Charities, and, possibly, a solicitor.

I would have thanked rog2 too,but my keyboard skills are slow!

Many thanks rog2.:D

davethetaller

rog2,....your message at 10.28 was comforting,...no guarantees though!

fiveyearplan

Rog2 that is comforting for me too because I am late in paying some PAYE (for my employees - only about £500) and my 2005/06 tax return has not been done yet because I cannot afford to pay the accountant - he has started them and they are at incomplete stage. My accounts for my limited company have not been done for the same reason and they were fue in Feb this year but are only for my first 2 months trading. OBviously I have made a loss and am still making losses which is why I'm in the position I'm in so I don't owe any money for that. I reckon I owe the taxman in one way or another about £1,000.

rog2

davethetaller wrote: »

rog2,....your message at 10.28 was comforting,...no guarantees though!

There can be no guarantees when it comes to HMRC as they are a particularily strange animal. However, if they had decided to go for 'fraud' I think your friend would have been the subject of 'in-depth' investigation by now.
If, as in my case, they are threatening bankruptcy, I assume that he has already had a CCJ taken out against him, by HMRC. This will be followed, assuming he has not paid the CCJ, by the service of a Statutory Demand, giving him a further 18 days to come to an arrangement with HMRC.
Quite soon after those 18 days (in my case it was about 2 weeks) he will be served with a petition for bankruptcy and will have to attend the High Court, London, where he will, quite painlessly, be declared bankrupt.
The Official Receiver will, probably, ask to see any invoices/accounts for the last 2-3 years, although in some cases they can go back as far as 5 years.
The OR will, probably, have done a criminal record search, but unless it is mentioned, by the OR, there would be no need for your friend to volunteer the fact that he has served a prison sentence for fraud. The decision as to whether a BRO is issued will be taken by the OR, based on the evidence he/she has.
Once your friend walks out of the high court, his debts are no longer his responsibility.

maxmycardagain

he traded for 15 years and HMRC didnt know?

and he wasnt on the dole?

and HMRC didnt ask



top man!


lol