CASE STUDIES
The Company operated in the software development and support sector and had historically used personal service companies to remunerate the directors (who were the sole employees of the Company). Following a change of attitude to this kind of arrangement the Company became embroiled in a significant dispute with HM Revenue & Customs over many years which drained the Company of its resources and prevented the directors from fully focusing on the operation of the business.
Following the directors recognising that the Company was running out resources to continue to challenge the claims brought by HMRC; they sought advice from their accountant who referred them to CMB Partners for advice.
It was concluded that the Company did not have the on-going resources to continue challenging the position and was facing insolvency (due to the sums alleged to be due to HMRC) but that it had some elements of the business that could continue (in particular one on-going contract) .
A creditors’ voluntary liquidation was undertaken and the remaining contract and general business/assets were valued by an independent reputable valuation agent and sold to another entity controlled by the director. This process allowed the contract to continue and provided value for creditors.
A claim was accepted in the Liquidation from HMRC who did not raise any concerns with the conduct of the Liquidation and a substantial return (£48,382) was paid to HMRC as a secondary preferential creditor.
The directors were incredibly thankful for CMB’s assistance in alleviating the long-standing stress caused by the dispute that arose and in their agreement to act solely on a fixed fee basis and return significant funds to HMRC.
