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By Lynne Gowers on 26th October 2018
The director of an engineering company based in Aberdeenshire has been banned for seven years from running a limited company after a string of tax failures over 4 years were discovered during an investigation by the Insolvency Service.
The penalty was handed to Victor Morrell, the sole director of Specmar Limited, a company which provided support services to the oil and gas industry.
In January 2017 the company entered into creditors voluntary liquidation as a result of challenging trading conditions.
After the company was wound up, Insolvency Service investigators found that between August 2012 and February 2016, Mr. Morrell filed inaccurate tax returns on behalf of Specmar and falsely claimed input tax on items that were out of scope.
After personal expenses were disallowed, it was calculated that due to the incorrect filing of tax returns, Morrell changed from being a creditor of Specmar in August 2014 to owing the company’s director’s loan account more than £350,000 at liquidation in January 2017.
Robert Clarke, chief investigator with the Insolvency Service, warned:
“Directors have a firm duty to ensure they deal properly with tax matters and pay what is due. Taxation revenue provides for the benefit of all and cannot simply be ignored.”
We would always recommend using a chartered accountant to help you prepare your financial statements and corporation tax returns, so you account for items correctly.
When it comes to closing a limited company, it is essential that the correct procedures are followed. This will help avoid unnecessary penalties and damage to your trading prospects as a company director in the future.
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