PLCs v HMRC

Having dealt with several large PLCs across our time we understand the difficulties all its subsidiaries can face. Several trading subsidiaries can each have their own financial difficulties/cash flow problems. Ultimately this can have a knock on effect across a Groups structure and overall cash flow too.

When we consider how best to help a PLC/Group we always try and look at what helps overall, this includes how best to assist each trading entity but it also needs to look at the bigger picture. Getting one company straight doesn't always help overall & then we face the scenario of 'robbing Peter to pay Paul'.

This is especially true if its HMRC arrears that have accrued! As we all know, if HMRC take one limited company down the winding up route inevitably they will focus on the Group as whole, being watchful & in most cases unnecessarily heavy handed towards the companies still trading and the Group itself.

Our Case Study

We were approached by a PLC, as all 4 of its trading entities were in difficulties, needing help across each we took time with our client to understand the existing set up, what they needed and all HMRC departments handling each separate company & separate liabilities owed. The PLC/Groups structure was important to understand, both from the perspective of solutions available and how to best tackle each issue, supporting the PLC as whole.

In total across all 4, the Group was being chased for ￡1.8million of HMRC arrears.

The board was also applying a lot of personal pressure to those in charge to ensure this didn't escalate. They had already tried several funding routes that hadn't been successful, tied in with a large issue around Invoice factoring they were literally in the position of two of the four limited companies heading towards winding up petitions.

We had to handle/view each company separately in order to figure out the best solutions for each. This was very much dependent on where each LTD company was up to within HMRCs collection process. We did however manage to get everything settled down for them, with a lot of work from everyone including those running the businesses.

The first company we got the Group a 16 month re payment plan agreed with HMRC. With this acceptance in writing they were able to change the Invoice Factoring agreement, better terms, better cash flow going forward.

The 2nd company we helped get funding in place to settle the HMRC liabilities in full, spreading the cost of this over 3 years.

The 3rd & 4th limited companies were at enforcement stages & we managed to get each of them a much longer term than normal - These liabilities were agreed to be settled across a 8 month term.

In addition we also helped the restructure of the PLC, affording them the ability to get a cash injection. This tied in with agreed payment plans has enabled them to carry on trading overall, with stability.

Our goal is always to support our client, we all know dealing with HMRC can be difficult but what is key is to understand their processes and how to use them to your advantage - check our new blog which explains some of this for you

https://www.taxdebtshelpandadvice.com/hmrc-re-payment-plan-our-guide/

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