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Steve65
Starting Member
34 Posts |
 Posted - 14 January 2010 : 20:56:53
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... my question is, if I'm planning on going BR in the next month or so and I can't pay my tax bill due January, what happens to July's tax bill when half the tax bill is due again, such are the rules for being self employed. Do I put down against my list of creditors the amount due now plus the figure that is due in July?
Would I also add to that figure, the 5% levy the Inland Revenue put on a bill if it's not paid February if I haven't filed for BR by that time?
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chester2005
Average Member
United Kingdom
786 Posts |
Posted - 14 January 2010 : 21:07:46
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you list HMRC as a creditor on your SOA for the amount due as per your tax return, the 5% levy is irrelevant to the OR.
Once you are BR the tax due is just another debt, when july comes you should not get any demand from HMRC and if you do just let the OR know that they have contacted you regarding a debt that has been included in your BR
Dave
Don't worry or know that worrying is as effective as trying to solve an algebra equation by chewing bubble gum.(Baz Lurman)
RevivaUK helped me through it all i can't recommend them enough!! |
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debtinfo
forum expert
2826 Posts |
Posted - 14 January 2010 : 21:41:28
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yep all tax that is due, or ever will be due on your earnings up until the date of the bankruptcy order will be part of the bankruptcy order.
You will start completely afresh the day after the bankruptcy order as if that was your first day of self employment |
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leakie
Junior Member
United Kingdom
158 Posts |
Posted - 15 January 2010 : 06:40:36
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Hi Steve 65
The July Tax is what you pay HRMC in advance,
therefore should not become a debt.
As Debtinfo has said, you are free to start up again after BR,
Also as Chester has said just pass it on to the OR,
I was BR in the January 2009 I did not receive or pay anything to HRMC in the July.
All the best
Leakie |
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Steve Thatcher
New Member
United Kingdom
70 Posts |
Posted - 15 January 2010 : 11:59:15
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For those on PAYE the following might help also:-
In addition to the tax which is not going to be paid, the Official Receiver will write to the HMRC to advise of the bankruptcy and this will result in the HMRC issuing a nil tax code if the bankrupt is on PAYE. The code lasts for the rest of the tax year in which you were made bankrupt.
The effect of the nil tax code is that the employer will not take any further tax from you for that year. The reason for this is HMRC will be recovering the whole of your tax for the current year.
It does not follow that your employer will know that you are bankrupt as a nil tax code can be issued for a number of reasons. It also does not mean that not tax is due.
Any tax that you do not have collected via the PAYE system will now be collected by the Official Receiver via an income payments agreement of order. If for instance you have an income payments agreement for £200, and you have tax that is not being collected for £300, the Official Receiver will collect the £200 and the £300. The taking of the additional tax will cease as soon as your tax code changes again, at the start of the new tax year
Steve Thatcher
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Steve65
Starting Member
34 Posts |
Posted - 15 January 2010 : 12:20:27
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Thanks guys for clearing that up for me.
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Talking of Tax....
