If you own a business and have recently received a bill from HM Revenue & Customs (HMRC) that you can't pay, it's important that you seek professional advice as quickly as you can.
If you fail to seek professional advice, and your tax debts remains unpaid, HMRC will start proceedings to recover the money.
If you do not pay the tax bill then HMRC is likely to take one of the actions below to recover the money.
Distraint This is where most of your possessions can be taken and auctioned to pay your bill plus distraint costs.
Someone from HMRC will visit your home or business and list your possessions on a form.
You are then required to sign the form, they won't usually take anything away that day - they give you five days to pay.
If you do not want or agree to sign the form, you'll still have five days to pay however they are likely to take your possessions there and then.
County court proceedings If HMRC are unable to collect the debt using a Distraint or they are able to start county court proceedings.
However if you pay what you owe the legal proceedings will stop.
If you can't pay straight away, you can make an offer within 14 days to pay by a certain date normally within 6 weeks of the court date.
Bankruptcy proceedings If you don't pay or your tax debts exceed your assets, you could be bankrupted and lose your home, business, savings and investments: oa statutory demand for payment will be served on you personally at your home oif within 21 days you don't pay or agree to settle a bankruptcy petition will be filed at the High Court othe petition will be served personally at your home oyou'll need a solicitor - they may be able to have the hearing adjourned to agree settlement terms If you continue to trade whilst being unable to pay your tax arrears then you also run the risk of becoming personally liable for the company's debts.
It is important as a director of a business to seek professional advice in order to work out the best possible solution for your business.