HMRC Personal Liability Notice

HM Revenue and Customs have the power to issue a notice to a company’s director pursuant to Section 121C of the Social Security Administration Act 1992, which has the effect of the director becoming personally liable for certain company taxation liabilities.

A Personal Liability Notice may be issued by HMRC if they consider that an officer of the company has caused an underpayment of contributions through fraud or neglect.

Some examples of when HMRC may consider issuing a Personal Liability Notice to a company officer include:

• Where a company has failed to pay its tax liabilities on time. 
• In circumstances where HMRC is of the opinion that the failure to pay the tax liability was attributable to serious levels of neglect or fraud. 
• If it is apparent that the company has paid other creditors, connected parties or the directors in preference to tax liabilities. 
• Where certain officers have been involved with previous companies that have failed to comply with their tax obligations. 
• Where there are phoenix companies with a history of non-payment of tax liabilities.

There are no restrictions on HMRC issuing a Personal Liability Notice to officers of liquidated companies.

If you have received a Personal Liability Notice from HM Revenue and Customs and are unsure what to do, or if you require general advice regarding your personal or company’s financial affairs, we at turpin barker armstrong may be able to help. Please contact our office on 0208 661 7878 and our experienced staff will be able to assist you.