HMRC has published new guidance setting out how it uses joint and several liability notices for company directors in cases involving tax avoidance, tax evasion or repeated insolvency.
The guidance explains how the joint and several liability of company directors legislation in FA 2020 Sch 13 will operate in practice. The aim of the legislation is to deter individuals from using insolvency as a way of getting out of paying their tax liability. It does this by allowing HMRC to give joint and several liability notices to directors, shadow directors and certain other individuals connected to a company. A joint and several liability notice will make the individuals jointly and severally liable for amounts the company owes to HMRC.
The legislation applies where a company is subject to an insolvency procedure or where there is a serious possibility of it becoming insolvent, and the company has either:
engaged in tax avoidance or evasion; or
incurred penalties for facilitating avoidance or evasion.
HMRC has published new guidance setting out how it uses joint and several liability notices for company directors in cases involving tax avoidance, tax evasion or repeated insolvency.
The guidance explains how the joint and several liability of company directors legislation in FA 2020 Sch 13 will operate in practice. The aim of the legislation is to deter individuals from using insolvency as a way of getting out of paying their tax liability. It does this by allowing HMRC to give joint and several liability notices to directors, shadow directors and certain other individuals connected to a company. A joint and several liability notice will make the individuals jointly and severally liable for amounts the company owes to HMRC.
The legislation applies where a company is subject to an insolvency procedure or where there is a serious possibility of it becoming insolvent, and the company has either:
engaged in tax avoidance or evasion; or
incurred penalties for facilitating avoidance or evasion.
