beta This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

Compliance Handbook

How to do a compliance check: charging tax and penalties: insolvency cases


Where a company is in liquidation it is important that you notify any assessments to the correct address.  This applies for assessments of penalties, as well as assessments of tax. There is a risk with companies in liquidation that if you do not notify the assessment correctly that it may be invalid.

This guidance applies equally in administration cases, where the terms administration and administrator should be substituted for liquidation and liquidator.

(The Insolvency Act 1986 sets out the legislative framework through which these and other approaches are governed).

Check the company status

The liquidator stands in the shoes of the directors and will generally change the company’s registered office to their place of business. Using HMRC systems there is no automatic way of knowing whether the registered office of a company has been changed, therefore it is important that you check Companies House data before issuing an assessment.  This is especially important if you have reason to believe a company might have recently gone into liquidation.

Issue the assessment and the notice of assessment.

If you have identified that a company in liquidation has changed its registered office then ensure the assessment is notified to the new registered office address.

Changes in the company’s registered office address can occur during the course of your compliance check. You must ensure that you confirm the company’s registered office by checking Companies House data before issuing an assessment notice. If the liquidator has not changed the registered office then the assessment should be notified to the latest registered office. The assessment notice should show the company name, it is not necessary to add ‘in liquidation’.

Time limits for Direct Tax and Penalties cases

The making of an assessment and its notification are two separate actions.  For direct tax cases and all penalties the time limits apply to the date the assessment was made on our HMRC systems.  Therefore a valid notification of assessment can be sent out after the time limit has passed without invalidating the assessment as long as it has been raised on our systems. (Please note appeal and review dates will usually run from the date of notification, not the date the assessment was made).  Guidance on time limits for direct tax and penalty assessments is at CH51000.

Time limits for VAT cases

In cases involving VAT (but not penalties based on VAT), the assessments must be made and notified within the assessing time limits. Guidance on time limits for VAT is at CH51800.

Assessments notified to the incorrect Registered Office

If a mistake is made and the notification is sent to the former registered office which the company occupied prior to liquidation, it does not necessarily mean the assessment is invalid, or that a mistake cannot be corrected.

It may be possible to defend a notification sent to a company in liquidation at its former registered office, on the grounds that this was the last known address. But this is more likely to be an effective argument in direct tax cases than in VAT cases because of the different way the legislation on service of documents is phrased (s115 TMA 1970 and s98 VATA 1994).

It may also be possible to defend a notification sent to the former registered office received by the liquidator (for example following redirection of post) as we may be able to argue that notification has effectively taken place.