www.iva.co.uk

Help!

Just had a very frugal christmas as money has been tight for the last 12 months, only to be landed with a demand for payment from the Inland revenue or they will fill for bankruptcy.

I have been self employed for the last 6 yrs and have steadily seen my income dwindle as I work in transport industry.Increases in fuel and overheads whilst companies refuse to pay more for services. I understand there maybe many in the same boat.

Last year I recieved a CCJ for none payment of tax but have not had the money to pay this of. This problem is being componded by other debts and a sizeable increase in my Mortgage payments.

To give you a handle on the problem 6 Years ago I was earning £50-55K per annum this is now down to around £30k.

I am married with 2 young children and just don't know what to do!

Hi Desperate and welcome to the forum

Is this your first year in an IVA? if it is was the ccj for tax due to the BEFORE the start of you IVA

Dave Beech

Beechy wrote:

Hi Desperate and welcome to the forum

Is this your first year in an IVA? if it is was the ccj for tax due to the BEFORE the start of you IVA

Dave Beech

Hi thanks for responding.

I have not yet entered into an IVA as I have tried desparatley to fight my corner for the last 12 Months but I'm now running out of steam, and I'm looking for help!

OK, the following is general advice and is intended to offer an overview, all cases are different

The revenue debt can be incorperated in to an IVA, along with all your other insecured creditors.

To put a proposal together idealy your lastest accounts will be required along with your projected trading for the future.

Before you can enter in to an IVA you will have to have a face to face meeting with an advisor, this is a mandatory requirement.

Thats a start.

What other unsecured debts do you have?

Dave Beech

Futher more,

If you are under significant presure an IP can apply to the court for an interim order.

Are you a Limited compant or sole trader/partnership

Dave Beech

Unfortunately the Revenue takes the highly unhelpful view that self-employed people have to pay tax just like everyone else with an income. The problem is of course that self-employed people don't have their taxes deducted at source so they run the risk of not keeping money back to settle their taxes when they're due.

You could put forward an IVA to settle the old debt but the Revenue will take your compliance record into account when they decide on whether to vote in favour of it or not, they would also want to see that your future earnings are sufficient to pay your future tax bills as well as your living costs and IVA payments. Finally, an IVA, being a multiple debt solution, is only really suitable if you have other debts as well, such as consumer debts, which can be lumped in with it. If your sole debt is with the Inland Revenue, then probably you will go bankrupt or alternatively you can try to thrash out a repayment plan with the Collector of Taxes.

Eventually companies are going to have to pay more for transport, or the nation's army of hauliers will simply decline the work and pay on offer. Your employers need you just as much as you need them or their stuff will just lie unsold at distribution depots.

Probably you will have to come to some adjustment in your lifestyle, I don't know what your wife's earnings are, but maybe she will have to increase her income, and some elements of your family expenditure will have to be reduced to bring you back to a level where you can afford to start paying back some of the old debt.

Philip Beck

Licensed Insolvency Practitioner and IVA specialist

Sorry pbeck dont agree with you, we find the revenue helpful when businesses are trying to address the problems.

As long as the detailed work is done correctly and the figures are realistic we find them helpful.

My job is dealing with busunesses that are having problems.



Dave Beech

I was just trying to say that the Revenue expects self-employed people to pay their taxes too.

Of course, yes, they will be helpful once they think people are trying to come to an arrangement with them, but they must see some action happening, too many people are bankrupted by the Revenue for doing nothing at all to try to settle the debt.

Philip Beck

Licensed Insolvency Practitioner and IVA specialist

I understand what you are saying and desperate looks like he is taking the first step to do this.

Dave Beech

Have you been up to date with your accounts because if you had higher profits in earlier years and they have fallen you should adjust the payments on account.
You might want to check your position with your accountant to establish just how much you owe at the present moment!

Good Luck

Also - look into your payments on account for the forthcoming year. I have just asked them to reduce mine to zero as it is very unlikely I will be paying any tax. You can do this by just writing to them and asking (only found this out a few months ago!)
The VAT people on the other hand do not seem so affable !

You can also down load form SA303 from their website as well and it is a form you can use to reduce the payments!