I owe £2,232 in tax but the new Chancellor isn’t too bothered
Ms J.G. writes: In 2016, I set up my own limited company and used an accountant to complete tax returns. In December 2018, I paid corporation tax of £2,133 as well as my own personal tax, but I realised the costs associated with a limited company were high in relation to the amount I was expecting to earn so with the help of my accountant, I closed the company in March last year. Final corporation tax due stood at £2,232 and I have tried repeatedly to pay this, but now the company is closed, the Revenue just does not accept it.
THIS really does come under the heading of ‘You Just Couldn’t Make It Up!’ A taxpayer fighting with the Revenue, not to pay no tax or less tax, but pleading to be allowed to hand over £2,232.
With the brand new Chancellor, Rishi Sunak, just days away from unveiling his first Budget, you might think that every penny would count, and a couple of thousand pounds would count even more. Not so, apparently.
What really counts, it seems, is getting your company’s tax reference right, and since the company no longer exists, neither does its reference number. Even after I alerted officials at the Revenue head office, things did not go smoothly. A letter from the taxman told you that ‘as the company has been dissolved, there is no longer an entity to chase for the debt’.
The letter explained: ‘Normally,
HMRC would object to the company being dissolved, so the debt could be enforced on the directors. This did not happen in this case. As you are no longer a director, HMRC cannot legally enforce the debt.’
But there was nothing to thank you for offering to pay the tax, and to avoid the need for any enforcement action at all. And the use of the word ‘debt’ left you concerned that somehow a black mark might end up on your personal credit file.
Officials were quick to assure me that there was no risk to you personally or to your credit rating. Last Wednesday, they told me: ‘We will be in touch with Ms G to explain how she can make the payment. We are sorry for the inconvenience caused.’
An hour later, you received a call from a rather irritated Revenue officer who asked you to tell her what the problem was. You did, and she then agreed to accept the £2,232 but she also wanted £11 interest for late payment. You flatly refused to pay the interest, and last Thursday your bank transferred the tax payment to the Revenue’s account.
Strictly speaking, the tax debt was not yours. You were being more than honest in taking on the moral obligation to pay it. But if the irritated officer gets back to you for the £11 interest, do let me know. This would make it even harder to believe.