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HMRC VAT Debts Bankruptcy

Can I include HMRC VAT debts in bankruptcy Yes you can. In fact, a large percentage of the cases we handle involve tax or VAT, sometimes both. One of the reasons for this is that HMRC is remarkably inflexible when it comes to payment plans, which need to be wrapped up within a 12 month period.

Imagine a time line where you include all assets and liabilities that you in your personal capacity have. Liabilities are taken away from assets if there are any. Even if you have a property with a mortgage with no equity it is still counted as an asset but an illiquid asset. HMRC and the revenue are creditors the same as any other creditor. They have no preference which means that they have to stand in line like everyone else. If you are concerned about being able to run your own business after a bankruptcy then you needn’t worry too much as theres no restrictions on Sole Traders in bankruptcy. So you can set yourself up as a sole trader as soon as you enter bankruptcy.

Depending on the case, this could mean a monthly commitment of £2000 – £3000 and most companies / self employed simply cannot sustain the payments. We think the Government is missing a trick here as surely it is better to recover the money over 24 – 36 months than get nothing at all. Still, it’s their call and they happily write off billions every year. No wonder our roads are in such a state.

Feel free to call us with any questions on HMRC and VAT Liabilities in Bankruptcy or for bankruptcy help on 01425 600129, we are here to help. Alternatively, post a question on our home page and we’ll help you that way. Please note, Court appearances are no longer required for bankruptcy and Bailiffs do not form part of the process.

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Bankruptcy UK-Debt Solution Bankruptcy Experts

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