To be fuming with DP re his business

[Wham83]

DP has a small business, been trading for over a decade. Not a huge turnover, just ticks over. It’s a very small operation, just him but I am listed as a minority share company director on paper only, I don’t have anything to do with the business, don’t take any money out etc, but obviously have to file tax returns via the accountant as I am listed as a director.

DP has a history for as long as he’s been trading of paying tax late and constantly being charged late payment fees by HMRC. It’s been a constant argument between us. He does have the money within the business accounts, he just doesn’t see it as a priority so doesn’t pay and it goes to debt collection…constantly. Well, this morning I’ve received a call on my mobile from a debt collection agency looking to recoup the money owed to HMRC. I have never had any personal debt that’s required debt collection and never received a call like this relating to his company. I felt so embarrassed and humiliated to receive the call. I do not understand why he doesn’t just pay the money on time - it’s there in the business account! I don’t have access to the business account as I am not involved with it, so I can’t pay it for him. It’s tiring to have the same rows and conversations about it every time tax or vat is owed.

AIBU to be fuming regarding the lack of care and for receiving the call?

So is this tax that was due (at the latest) by 31st January this year? If it’s with a debt collection company it must be well overdue?
Im self employed and have made two payments this year, one at the start of the year and then another in July. Both always before the deadline.
He must be literally ignoring all the letters 😬.
Tax is annoying enough to pay as it it, never mind having to pay late fees on top of it! That’s unbelievably stupid. I think he’s hiding something.

If this debt is related to his personal self-assessment, you were likely correct in refusing to speak to the debt collection agency. As an owner/shareholder, etc., his personal tax matters are indeed his own tax matters. If anything, it sounds like they have made a pretty major GDPR breach.

If a debt collection agency contacted one of my shareholders or directors about my personal tax liability, I'd file an official complaint.

Company VAT, NI etc, fair game.

He’s at work - so whilst “I’m tapping away on mums net” I won’t know until he gets home this evening whether he’d paid it

No, that’s an untrue assumption. He’s factory testing today so doesn’t have his phone on him, not allowed mobiles on factory floor. He’ll likely ring me on his way home.

@Raspmag he also takes a salary from the company according to an update from the OP. Let's hope he's up to date on those remittances, or HMRC will really come down on him.

£1100 in dividends plus a salary, he doesn’t pay himself bare minimum like a lot of directors do. I don’t take a salary from the company, and I have my own career, not self employed.

Out of everyone you need to pay, HMRC is the top priority. HMRC don't give up on debt, they will recover what is owed. They have a lot of power, and if necessary will take your home to recover debt. Your husband is being very foolish. If it's purely laziness, then he's even more foolish. Remove yourself from the Directorship, but others are correct you are as legally responsible for paying HMRC as your husband is.

OP, are you sure this call was legit and not a scam?

There are plenty of “you owe HMRC” scams out, there, and considering that your DH actually does have outstanding debt to HMRC this would be an easy one for you to fall into.

It goes without saying that he’s in the wrong either way, but I would tread with caution here considering this agency appear to have breached GDPR.

It's not her debt.
A limited company is a separate entity and it's the company's debt.
The worst that's likely to happen is that HMRC petitions for the company to be wound up.

That said there are some complications for her.

1. It is an offence not to file accounts or annual confirmation statements. I'm dubious these are being done.
2. Other company debts may be secured against personal guarantees. On winding up those guarantees will be enforced.

You need to be careful. If it’s with a debt collector it’s very unlikely to be the latest tax year they are pursuing. You absolutely must insist on seeing all the accounts. Do not take anything your dp says on trust.

Ok. If it's paid twice a year theni suspect it's not a company debt. Rather it's payments on account against his tax self-assessment (two projected payments and a balancing payment). That's PERSONAL tax, not company PAYE, nor Corporation Tax.

If that's the case then being a director has nothing to do with this, and company funds should not be used to pay it since it will relate to monies you've received, mostly paid gross (no deductions).

However since you're also receiving dividends (even though they go into a joint pot) you will also have a personal tax liability and should have been filing SA tax returns.

I think you need to be more explicit as to what is owed and who is being pursued. I dont think you actually understand...

Yeah, you'll get several warnings before HMRC call in a third party agency to collect the debt.

Are you sure it’s the July one? That’s quite quick for them to get debt collection involved. Unless he’s now on their radar as a cause for concern and they’re taking a heavy handed approach more quickly due to his history of not paying.

That's a good point - have you been declaring your dividends as income and paying tax appropriately @Wham83?

@CanSeeClearlyNowTheRainHasGone has a good point. “However since you're also receiving dividends (even though they go into a joint pot) you will also have a personal tax liability and should have been filing SA tax returns.”

Yes, it’s all declared. The accountant has a copy of my p60 from my employment each year and copies of dividend vouchers, they then file a self assessment on my behalf and tell me how much I need to pay to HMRC.

Like others say, take it over if you're organised and he's not-it sounds like there's lots of benefits and no downside from what other posters have said.

Edit: Oops. Eyesight. I misread your post.

You dont mention though if you've paid your additonal personal tax, only that you've filed returns.

It isn't "easier", it results in less tax for the dividends received.

I pay my personal tax before the due date each time. I am fully declared, filed, and upto date with payments.