Press release

Director duo tested to destruction and flushed out

John and Tracy Williams have been disqualified for a combined 14 years for failing to make over £60,000 worth of payments to HMRC.

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John Williams, of Stirlingshire, has been disqualified for 10 years for acting as a company director of Weldtek QA Limited whilst he was disqualified and failing to make payments to HM Revenue & Customs (“HMRC”).

His wife Tracy Williams who was the sole appointed director of Weldtek QA Ltd has also been disqualified for 4 for abrogating her duties and allowing John Williams to act as a director whilst he was disqualified and whilst also allowing him to trade the company to the detriment of HMRC.

The company traded from Standburn, Falkirk in Non-Destructive Testing and failed to make payments to HMRC for Corporation Tax, VAT, PAYE and NIC totalling £68,514.

On 26 April 2016, the Secretary of State accepted a disqualification Undertaking from John Williams, from 17 May 2016 for 10 years.

On 3 May 2016, the Secretary of State accepted a disqualification Undertaking from Tracy Williams from 25 May 2016 for a period of 4 years.

The matters of unfitness, which Mr Williams did not dispute in the Disqualification Undertaking, were that from at least 18 March 2013 to 29 May 2014, he acted as a director or was involved in the management of Weldtek QA Limited whilst disqualified.

On 10 October 2012, Mr Williams had given an undertaking to the Secretary of State for Business, Innovation and Skills, which came into force on 31 October 2012, that for a period of 3 years and 6 months he shall not be a director of a company, act as a receiver of a company’s property, or in any way, whether directly or indirectly, be concerned or take part in the promotion, formation or management of a company unless he has the leave of the court. Mr Williams therefore did not have leave of the court to act as a director.

The disqualifications effective from 17 May 2016 for John Williams and 25 May 2016 for Tracy Williams prevent them from directly or indirectly becoming involved in the promotion, formation or management of a company for the duration of the term.

Among the matters of unfitness, which Mr Williams did not dispute in the Disqualification Undertaking were that he acted as a director or was involved in the management of Weldtek QA Limited whilst disqualified, having given undertaking to the Secretary of State for Business, Innovation and Skills, not to do so for three years and 6 months, from 31 October 2102.

Furthermore, he caused Weldtek QA Limited to trade to the detriment of HMRC and failed to ensure the company made full payments due to HM Revenue & Customs “HMRC”) in respect of Corporation Tax, VAT, PAYE and NIC as a result of which HMRC are owed £68,514 at liquidation.

Among the matters of unfitness, which Mrs Williams did not dispute in the Disqualification Undertaking were that from at least March 2013 to May 2014, she was the sole appointed director of the company, notwithstanding this, she abrogated her duties throughout the period to John Williams, including allowing him to act as a director of a company while disqualified.

Commenting on the disqualification, Robert Clarke, Investigations Group Leader at The Insolvency Service said:

Directors who ignore disqualification orders made against them, and those who provide cover for them to continue to run limited companies, will be vigorously pursued by The Insolvency Service. The lengths of the Disqualification Orders in this case send a clear message as to the serious view taken by the Court of such corporate impropriety.

In addition, Company directors should be under no illusion that it is a criminal offence for persons to act as company director whilst disqualified. They should be in no doubt that The Insolvency Service will investigate and the Department for Business will prosecute those who choose to ignore this warning. A disqualified director who continues to act as a director when explicitly restricted from doing so, shows a total disregard for the insolvency regime, creditors and the business community.

Notes to editors

John Williams’ date of birth is 6 December 1952 and he resides in Stirlingshire.

Tracy Williams’ date of birth is 25 March 1965 and she resides in Stirlingshire.

Weldtek QA Limited (SC385032) was incorporated on 8 September 2010. Its registered office was Chaos Cottage, Standburn, Falkirk, FK1 2HN. It traded from the same address. Weldtek QA Limited was placed into Liquidation on 27 August 2014.

Mrs Williams was an appointed director from incorporation. On 27 August 2014, the company was wound up on a petition presented by HMRC.

John Williams

The matters of unfitness, which Mr Williams did not dispute in the Disqualification Undertaking were that :

  1. From at least 18 March 2013 to 29 May 2014, John Williams acted as a director or was involved in the management of Weldtek QA Limited whilst disqualified in that on 10 October 2012, he gave an undertaking to the Secretary of State for Business, Innovation and Skills, which came into force on 31 October 2012, that for a period of 3 years and 6 months he shall not be a director of a company, act as a receiver of a company’s property, or in any way, whether directly or indirectly, be concerned or take part in the promotion, formation or management of a company unless he has the leave of the court. No such leave was given to John Williams by the Court.

  2. From at least 18 March 2013 to 29 May 2014 in respect of Corporation Tax and VAT, and from 19 May 2013 to 29 May 2014 in respect of PAYE and NIC, John Williams caused Weldtek QA Limited to trade to the detriment of HMRC and he failed to ensure the company made full payments due to HM Revenue & Customs “HMRC”) in respect of Corporation Tax, VAT, PAYE and NIC as a result of which HMRC are owed £68,514 at liquidation. In that:

CORPORATION TAX

  • For the year ended 30 September 2011, the company had a liability of £15,446. This sum ought to have been paid in full to HMRC by 1 July 2012. £9,475 was paid and £5,971 remained outstanding at liquidation;
  • For the year ended 30 September 2012, the company had a liability of £9,793. This sum ought to have been paid in full to HMRC by 1 July 2013. Nothing was paid and this sum remained outstanding at liquidation;
  • For the year ended 30 September 2013, the company had a liability of £14,144. This sum ought to have been paid in full to HMRC by 1 July 2014. Nothing was paid and this sum remained outstanding at liquidation;
  • As a consequence at liquidation, HMRC’s claim totalled £29,909.

VAT

  • Between 18 March 2013 and liquidation, despite the company submitting 6 returns totalling £29,323 and HMRC raising assessments totalling £8,344, John Williams failed to ensure the company complied with its statutory obligation to make full payments to HMRC in respect of VAT as and when it fell due. As a consequence of his failure to comply, at liquidation, HMRC’s claim totalled £39,476 of which £34,712 (Including £3,251 of default surcharges) related to the trading period;

PAYE and NIC

  • A P35 End of Year Return for the tax year 2012/2013 submitted on 5 December 2013 disclosing a liability of £807 was submitted to HMRC by the company. This sum ought to have been paid in full to HMRC by 19 May 2013. Nothing was paid towards this liability which remained outstanding at the date of liquidation;
  • For the tax year 2013/2014, the company submitted monthly returns for the period 6 April 2013 to 5 April 2014. HMRC records showed that for this tax year, the company were due to pay over £889 for PAYE and NIC, all of which remained outstanding at liquidation;
  • For the tax year 2014/2015, the company submitted monthly returns for the period 6 April 2014 to 5 June 2014. HMRC records showed that for this tax year, the company were due to pay over £342 for PAYE and NIC, all of which remained outstanding at liquidation;
  • As a consequence at liquidation, HMRC’s claim totalled £3,892 (including interest and penalties of £1,853).

Tracy Williams

The matters of unfitness, which Mrs Williams did not dispute in the Disqualification Undertaking were that:

From at least 18 March 2013 to 29 May 2014, Tracy Williams was the sole appointed director of the company, notwithstanding this, she abrogated her duties throughout the period to John Williams. As a consequence of her abrogation, Tracy Williams: * Allowed John Williams to act as a director and be involved in management of the company whilst disqualified. * Allowed the company to trade to the detriment of HMRC throughout the period from at least 18 March 2013 to 29 May 2014, such that HMRC is the only known creditor for £68,514

A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot: * act as a director of a company * take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership * be a receiver of a company’s property

In addition that person cannot act as an insolvency practitioner and there are many other restrictions are placed on disqualified directors by other regulations.

Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.

Further information on director disqualifications and restrictions can be found here.

The Insolvency Service administers the insolvency regime, investigating all compulsory liquidations and individual insolvencies (bankruptcies) through the Official Receiver to establish why they became insolvent. It may also use powers under the Companies Act 1985 to conduct confidential fact-finding investigations into the activities of live limited companies in the UK. In addition, the agency authorises and regulates the insolvency profession, deals with disqualification of directors in corporate failures, assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees, provides banking and investment services for bankruptcy and liquidation estate funds and advises ministers and other government departments on insolvency law and practice.

Further information about the work of the Insolvency Service, and how to complain about financial misconduct, is available.

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Published 27 July 2016