Crackdown on rogue directors who dissolve companies to avoid paying debts
The Government has launched a crackdown on bosses who dissolve their companies to avoid paying their liabilities, with rogue directors facing disqualification for up to 15 years or even prosecution.
The Insolvency Service has been granted new powers, on behalf of the Business Secretary, to investigate and disqualify company directors who abuse the company dissolution process, and leave many SMEs struggling with unpaid bills.
The Rating (Coronavirus) and Directors Disqualification (Dissolved Companies) Act will also help tackle directors dissolving companies to avoid repaying Government-backed loans put in place to support businesses during the pandemic.
If misconduct is found, directors can face sanctions including being disqualified as a company director for up to 15 years or, in the most serious of cases, prosecution.
As part of this new legislative power, directors could now also have to pay compensation to creditors who have lost out due to their fraudulent behaviour.
Commenting on the move, Business Secretary Kwasi Kwarteng said: “We want the UK to be the best place in the world to do business and we have provided unprecedented support to businesses to help them through the pandemic.
“These new powers will curb those rogue directors who seek to avoid paying back their debts, including Government loans provided to support businesses and save jobs. Government is committed to tackle those who seek to leave the British taxpayer out of pocket by abusing the covid financial support that has been so vital to businesses.”
The Insolvency Service has powers to investigate directors of companies that enter a form of insolvency, including administration and liquidation and may also be instructed to investigate live companies where there is evidence of wrongdoing.
The Act also delivers on the commitment to rule out COVID-19 related changes as grounds for material change of circumstances (MCC) business rate appeals.
This is due to the fact that market-wide economic changes to property values, such as from COVID-19, can only be properly considered at general rates revaluations.
In addition, the Government says it is providing £1.5bn in business rates relief to sectors hit hardest by the pandemic, and which have not been eligible for existing support linked to business rates.
This month it provided guidance to support local authorities to set up their local schemes through which businesses will be able to access relief.
For help and advice on related matters, contact our expert team today.
Leave a Reply
Cancel reply
Leave a Reply
Social
Recent Posts
- Steps for employers to remain compliant with National Minimum Wage increases
- Simple ways to invest in your team this Career Development Month
- Simple ways to invest in your team this Career Development Month
- Double cab pickups to be taxed as company cars as Government confirms U-turn
- How to ease the pressure within your business this Stress Awareness Day
Archives
- November 2024
- October 2024
- September 2024
- August 2024
- July 2024
- June 2024
- May 2024
- April 2024
- March 2024
- February 2024
- January 2024
- December 2023
- November 2023
- October 2023
- September 2023
- August 2023
- July 2023
- June 2023
- May 2023
- April 2023
- March 2023
- February 2023
- January 2023
- December 2022
- November 2022
- October 2022
- September 2022
- August 2022
- July 2022
- June 2022
- May 2022
- April 2022
- March 2022
- February 2022
- January 2022
- December 2021
- November 2021
- October 2021
- September 2021
- August 2021
- July 2021
- June 2021
- May 2021
- April 2021
- March 2021
Categories
- Accountancy
- Accounting
- Agriculture
- Apprentices
- Asset and Wealth Management
- Ben Allen
- Blog
- Blogs
- Bookkeeping
- Brexit
- Budget
- Business
- Business Advice
- Business Advice News
- Business Blog
- Business News
- Business Start-ups
- Capital Allowances
- Cash Flow
- Cash flow management
- Charities
- Corporate Tax
- Corporation Tax
- Covid-19 Home working and expenses
- Economy
- Employees
- Employment
- Employment and payroll
- Family Businesses
- Finance
- Financial News
- Financial Planning
- Fraud
- Funding
- Government Funding
- Grants
- Guide
- HMRC
- Home working and expenses
- Income Tax
- Inflation
- Inflation / Interest Rates
- Inheritance
- Insurance
- Investment
- Latest Business News
- Latest News
- Legal
- leisure and hospitality
- Loans
- Making Tax Digital
- Money
- MTD
- News
- PAYE
- Payroll
- Pension
- Pensions
- Personal Tax
- Personal taxes and finances
- Property
- Property News
- R&D
- Redundancy
- Scam
- Self Assessment
- Self Employed
- SME
- SMEs
- SMEs / Business
- Start ups
- Tax
- Tax Blog
- Tax News
- Tax Planning
- Tourism
- Uncategorized
- VAT
- VAT and MTD
- VAT deferral
- Wages
- Wealth Management