TAX INVESTIGATION URGENT ADVICE NEED

[chez1230]

My husband is undergoing an investigation into his 07/08 sole trader accounts, which started in November 2009 , what has been undercovered is the professional neglect of his Accountant along side ignorance on his side, bascially the Accountant has offset everyhing ie: £102k incoming with 30k profit & offset 70k in expenses, took advice and employed a new Accountant who has redone accounts to show same income 102k but with 69k profit & 33 k in expenses, therefore realising a tax liability of 18k, plus interest & penalties . The redone accounts have gone to HMRC 2 weeks ago and we are awaiting to hear from them.

My husband has filed his returns and paid tax due every year on time apart from Jan 10 bill which we have not been able to meet due to severe financial difficulties, his work has been serverely affected by the recession with a 50% drop in income.
Current situation from sept 08 we have traded as a limited company and are scraping to stay afloat . Big worry is that HMRC will look into other years , and we could end owing £150 plus which will with out doubt mean bankruptcy, this may be the only way anyhow as we do not have the funds for the tax liability of the revised accounts.

Really at wits end as have tried to get advice but its seem to be conflicting, can anyone recommend a good Tax specialist who is genuine, [ we recently had an ISP who wanted us to pay 3500 plus vat upfront to do a full and final settlement iva ]

Any advice appreciated

[robbob]

Hello chez

Is the Jan 10 Bill a personal tax Bill?
If it is a personal tax Bill are there any payments on account included for 2009/10?

Now you are trading as a limited company i would expect there to be little personal tax liability - unless he either has income from other sources or his income makes him a higher rate taxpayer (unlikely due to the drop in profits)

[scottie2]

You are right-you need to secure professional TI advice. How long has your husband been self employed as this will have a bearing on the number of years HMRC might be able to go back. There are a number of other factors that will affect how HMRC takes matters forward and I would be happy to discuss them with you. HMRC does not want to bankrupt your husband and will look for ways in which this might be avoided, for example, do you have any equity in a personal residence, or any other asset on which a loan might be secured. I specialise in tax investigations and have helped many people in securing agreement with HMRC. Please get in touch at manoj.anand@wlhtax.co.uk.