Husband not been paying tax for years

[Shitsinthepost77]

I'm so worried and scared. Over a year ago two debt collectors came to our door and handed me a letter addressed to my husband. I opened it and it said we owed approx £500k to the taxman. I nearly collapsed.

When my husband came home I confronted him and he basically broke down saying he hadn't been paying tax on his Ltd company for about 5 years. He'd liquidised his company without my knowledge and taken me off as Company Secretary presumably so I wouldn't find out and to extricate me from any financial liability. We had to get a tax lawyer to negotiate on our behalf with the debt collectors and after many months of wrangling, my husband told me it was £64k we owed which we could put our savings towards and also set up a direct debit and pay the rest monthly.

Fast forward a year, I had two debt collectors standing at my front door. It turns out my husband has been lying about the amount owed...it's in actual fact £150k. I'm horrified, my heart's racing as I'm writing this. He told me over the phone he'd used £30k of our son's trust fund money towards it. He told me he's incapable of saying no to me (?!) and he knows he's got emotional problems.

I don't understand any of this...I'm in my 50s, yes, I like nice things (who doesn't) but never overspent in terms of the money that's in our account and was surplus after all bills are paid. He didn't come home last night, he's too ashamed and embarrassed and keeps telling me he's no good and I deserve better. I've been with this man for over 30 years and can't imagine life without him, although I massively resent him at this point.

I found out he'd taken his watch (a present for his 50th) to a pawnbroker to get a £1,500 per loan against the watch. He said it was to pay off the rest owed to the tax lawyer. I asked (shouted) why the hell did he not come to me as I'd managed to put some money aside. Again, he was too embarrassed and said he just wanted it sorted and out the way. I ended up giving him over £2k to get the watch back.

I'm worried sick. How on earth do I deal with this without knowing whether he's lying or not? I don't have access to his business account because I'm not company secretary. I have access to everything else (I think?).

I'm mostly disgusted at my son's trust fund. He's 21, and it was meant to be for a down payment on a flat at some point. Now there's nothing. My son's now aware of this and thinks I should leave his dad as he can't be trusted. What do you think? Any advice would be extremely welcome.

This is an excellent post, please read it very carefully Op. I was married to ( and in business with ) a man just like your Hisband . Over the years we were together I scrimped and scraped as we weren’t making much profit .

When the shit hit the fan and I found out he was cheating, I divorced him. It turned out he had taken £600,000 out of company and given it to his mistress and out some in gold. We owe so much to HMRC and another party, even 3 years post divorce I will end up losing my house over it.

Don’t believe a word your husband says, or the tears. Divorce him now. Ask for all the full compant accounts going back since yYOU married and take them to an acountant. The full accounts not just the summary you can see online .

Ask him for access to the company banking system online.

You've lived an easy life being a SAHM to one child all your life. You need to bear some of the responsibility for this mess

He is a liar and a tax evader but the OP has to take a bit of responsibility. Even a wife who doesn't work should take an interest in financial matters. And spending 1-1.5k a month on medication is ridiculous. Reading between the lines it sounds like she has been a big spender - burying her head in the sand as to where the money came from.

Yabu for not knowing whether he's lying.

You have to leave him. You can't trust anything he says.

I have drummed this message into my young adult son and daughter. Fortunately, they both agree completely.

Absolutely. It’s terrifying how many women just let a man handle everything and have no financial independence or ability to support themselves when the shit hits the fan.

Maybe he got into a mess and couldn't find a way out, and cannot bear the shame of failure. I feel, you should be helping him not jumping ship.

@Shitsinthepost77 this does put a different perspective on everything.

You and your DH need to have a series of really honest conversation, possibly with a counsellor or accountant to tease out exactly what debts you have and to draw up a reasonable budget. He can’t protect you from the truth because of your past and you can’t avoid facing up to going back to work. You need to be a partnership to resolve this.

You admit to having a nice lifestyle and not having worked, this has to change. The one practical thing you can do today is to review your household bills for the last 12 months - work out essentials e.g. mortgage, gas, council tax, insurance and non-essentials. This helps you to draw up a realistic budget going forward. 12 months takes into account annual payments such as insurance. You will need to review birthday and Christmas presents as well as holidays etc. understanding the minimum you need to live on allows you to work out how much you can pay towards the HMRC debt.

You are going to have to work - start by going to your local job centre and find out what back to work training they offer. Local Adult Education will have IT courses to upskill you, potentially free.

I am also going to suggest something slightly controversial - your husband works for his own company is their a proper job in the company you could do, even part time? You would be paid for the hours you genuinely work contributing to family income and gaining confidence and experience for your CV.

Difficult to help him when he's buggered off and not come home.

Just how many 'nice things' have you been wanting? It sounds like he has decided not to pay his tax obligations to fund your lifestyle.

I do understand this situation OP , except for us it was the reverse . Like your H I found it hard to say no to my somewhat ‘champagne lifestyle H’ and in all honesty what we had was via his efforts mainly although I did work full time and business was in my name . I am a chronic people pleaser and my H reacted badly when I ever made suggestions about having a lesser house or not having 4 hols ( not flash ones) every year. I think your H was very wrong but clearly cares and I think he was hiding stuff because it’s clear you were struggling if addicted - once you get behind on tax , it can be very hard to catch up and you kind of bury your head in the sand. I think you have to have been there - it kind of mushrooms and is made worse if you have a partner you are tied to financially who is also making demands/has issues

i think people are being very black and white and you have a bit of responsibility too as you must have known your level of spending on medication wasn’t sustainable - however what’s done is done so no point going there

with regards to business, you need to know what they are coming after - if it was a limited company and liquidated was it done via a CVL or did HMRC ‘wind him up’ ? - if it was a CVL it may be they are after his directors loan which he may have used to pay himself because essentially it’s money he was taking out the company over and above what he was entitled to if he had allowed for tax - if he was wound up’ the official receiver will assess and again go after a directors loan and yes if you don’t pay up they can bancrupt and force house sale. However you can often negotiate with the official receiver - I wonder if that’s what he did - hence the reduction , but has yet to come up with the readies because he’s been trying to find a way to broach it with you

on the other hand it may relate to personal tax, in which case you are going to have to remortgage or sell or go bancrupt ( In which case they can still go after the house) I’m not sure if an IVA would be feasible, that usually saves house but would be whacking payments

you do need to toughen up a bit, if he has to work away, so what, try and get yourself a job , any job and if he’s away you will get some headspace too - your son is learning a life lesson - you simply were not in the trust fund league and it was built on sand

wishing you well - there are ways through this, none are easy

Ok fair enough - but the child trust fund accounts cannot be accessed by parents once the YP is 18 (this has caused issues and hassle to those whose YP has turned out to have LD) so I assumed it must be a private trust fund. And the father took 30k OF the trust fund which suggests the fund was pretty large - and it was built on funds stolen from the tax payer by the sound of it.

How much is your house worth? You should sell it and either buy or rent a small two bedroom house or flat and use the equity to pay off the debt.
Tax evasion is one of the reasons this country is in so much trouble but it’s those with disabilities who are threatened with having their benefits cut and paying the price for people not paying their correct amount of tax. If you choose to stay with him after every thing he has done and every lie he has told, then you must shoulder the debt with him and live as many of us do, a frugal existence but with the dignity of not owing anyone anything.

Yep, reading her updates neither of them are covering themselves in glory. OP hasn’t worked in about 20 years, was addicted to drugs and spent thousands of pounds each month to fund said addiction while her husband shouldered the financial burdens, stole from their DS and committed serious tax evasion.

It sounds like a massive shit show all round.

I think this one is a bit more complicated than just leave him. If he was worried about previous addiction issues I can see why he perhaps didn't want to put this on you.

Is downsizing your home an option? House price alone doesn't tell us much as 300k in one area is a five bedroom and in another a flat.

You need professional advice here. You can't afford not to pay for it.

Try and talk calmly. The trust fund is bad and there will need to be work there but it will have to be part of a wider solution.

Whether you leave him or not, life is going to have to change significantly and you probably need to come to terms with that before starting discussions.

Over £72k at least to pay for the drug addiction, thankfully now treated. But my reading of the OP’s update is that he stuck by her in sickness and in health and now it’s her turn to do the for richer for poorer bit.

I think you may also have a typo in your OP. Did you mean it was initially 50k ( not 500k) and has now risen to £150k?

Whether it is 50k or 500k is probably skewing answers. It's lying regardless but the latter implies a much more extravagant lifestyle.

I can't turn to family. My elderly mum needs her savings and my sister has always appeared to be resentful of me it would appear. She always said in the past, 'you may have the looks but I've got the brains'. A lot of bitterness there and she's always treated me horrendously ie 'shut up trollop' etc etc. Or blonde bimbo....

What would your sister's view of your relationship be?

Yes I agree. £150k a year is a good wage but clearly not enough to live the high life with a sahm with a £1k a month pill addiction and put £30k into a trust fund etc. Sounds like some wilful ignorance as to exactly how they had so much money . That being said, I'm not sure adding more to a mortgage is a great idea, especially when the husband doesn't seem to be taking any responsibility. Even when he pawned his watch OP got it back for him. The house will go if he defaults. Maybe better to sell the house, pay the debts and mortgage and live far more modestly either together or apart if possible.

Financial issues, however large, can be sorted out. We don't throw people in prison for debt anymore unless their is fraud involved. Even prison isn't actually the end of everything. People can and do get through huge life challenges. It often involves complete changes in lifestyle and expectations, but that's not the end of the world either. But it has to start with complete honesty as to what the position is and why it happened. Without that everyone is wasting their time. So unless he is prepared to do that as a couple, then you need to start looking out for yourself quickly.

Many do on policies older than 12 months

Excellent advice, and compassionate.

Agree, and noting the OP's acceptance of being 'unemployable' and passivity in lifestyle choices ('who doesn't?'). Not saying he's right to blame her, but she has to get way more active in her life, not be a helpless victim (also in sister situation), which is what years of this 'traditional' role can feed. There's no option to not get a job and there are jobs she can do if it's the difference between sinking or swimming.

It is still not clear how there doesn't seem to be a professional accountant involved in all this

Perhaps you both need to sit down together and work how to resolve this.

Honesty is paramount.
Could you downsize?
Could you get a job?

If you don't want to do this then I guess a divorce is the answer.