Director of Company / Voluntarily Liquidated

[AngusandIvy]

Hello

I have had ILR for 18+ years and want to apply for citizenship. However, I was one of two directors of a limited company which we voluntarily liquidated due to insolvency in 2013. Our company was badly affected by the downturn, and this, combined with clients who defaulted on our invoices, left the company with a £45k bill to HMRC which the company couldn’t pay.

I previously also had an overdue £6k SA bill which I agreed with HMRC to pay in instalments, which I paid in full in 2011.

I’ve read that in cases of company liquidation through no fault of your own will not cause an application to be rejected, but it sounds like this is a very subjective call on behalf of the HO. How does one demonstrate no fault? I believe this applies in my case with both debts, but I’m not sure how to demonstrate this.

Would my application likely be refused?

[alterhase58]

There are two different entities - the limited company and you as a private person.
First of all, if you have complied with arrangements you made with HMRC to clear any taxes/NI due then there is no issue as far as I can see. Under (or over) payment of taxes is an everyday occurance, certainly with PAYE. If however HMRC take you to court for tax evasion that would a criminal matter. If your were "reckless" as a company director, a serial defaulter, etc that would likely count against you. Presumably the assets which were liquidated covered the company tax bill?

[AngusandIvy]

Thanks for your reply.

There are two different entities - the limited company and you as a private person.
First of all, if you have complied with arrangements you made with HMRC to clear any taxes/NI due then there is no issue as far as I can see.

For the personal tax bill, I set up a payment plan with HMRC and cleared the debt in full.

If your were "reckless" as a company director, a serial defaulter, etc that would likely count against you. Presumably the assets which were liquidated covered the company tax bill?

Unfortunately the assets’ value was not enough to cover the company tax bill. The company was officially dissolved in 2015, with no objections from HMRC. The reasons for winding up the company were economic downturn and clients defaulting on amounts owed to the company. There wasn’t a history of defaulting by the company before this.