From 1 December 2020, arrears of crown debts (unpaid VAT, PAYE, employee national insurance contributions and CIS deductions) will obtain secondary preferential status. This means they will rank ahead of some debts secured by lenders, reducing cashflow for businesses and increasing personal exposure for guarantors.
What’s proposed?
The Finance Bill 2019-21 recently received Royal Assent and HMRC will again become a secondary preferential creditor. Many involved in restructuring and insolvency have long campaigned against this, fearing adverse consequences for businesses, their lenders and their owners.
Protecting your taxes in Insolvency?
The Finance Bill 2019-21 recently received Royal Assent and HMRC will again become a secondary preferential creditor. Many involved in restructuring and insolvency have long campaigned against this, fearing adverse consequences for businesses, their lenders and their owners.