Keeping inadequate records is not only a sure-fire way to end up with problems with HM Revenue and Customs (HMRC) but it can also lead to being disqualified from acting as a director. Often, it is a PAYE visit by HMRC that turns up issues involving the employment of illegal workers.
Such issues are particularly common in the restaurant trade, and restaurateurs are frequent targets of compliance visits.
In a single month, three directors of companies have found themselves banned for such offences.
In the first instance, a limited company which owns a restaurant was found to be employing three illegal workers and was fined £30,000. The company went into liquidation and the fine was unpaid. However, the Insolvency Service then sought and obtained a disqualification order against the company's director, which bans him from being a director of a UK company for seven years.
Another seven-year ban was served on a restaurant owner who failed to keep adequate accounting records, which led to HMRC raising assessments to VAT totalling some £129,000. The company also failed to file accounts as required by law.
In the last instance, a restaurant company went into Liquidation owing HMRC more than £400,000, leading to the disqualification of both directors for three and a half and seven years respectively. The director banned for seven years was also given a personal liability notice of more than £80,000 for deliberate suppression of the recorded takings of the company.
Says Leanne Schneider-Rose
HMRC are becoming progressively more adept at uncovering such misdeeds and, together with the Insolvency Service, prosecuting those who seriously transgress.
For help or advice on this or other related matter, please contact Leanne Schneider-Rose on 0121 698 2200
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