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HMRC internal manual

Compliance Handbook

Managing serious defaulters (MSD) for specific customer groups: FIS (Fraud Investigation Service): FIS insolvencies

Who will be considered for inclusion in the Managing Serious Defaulters (MSD) programme?

From 1 April 2013, MSD will monitor insolvencies, identified by FIS as a high ongoing risk to HMRC, to assure their future compliance.

MSD insolvency cases have one or more of the following features:

  • HM Revenue and Customs is the major creditor
  • the insolvency is considered to be contrived or the insolvency process has been manipulated by the company to the detriment of HMRC
  • minimal distrainable assets at liquidation
  • the actions of the directors lead to the insolvency
  • HMRC liability is disguised by non-submission of returns, incorrect returns and/or payment of low assessments
  • a link between the insolvent company and its successor by way of directors, a manager or other responsible persons
  • a new company continues trading from the same premises and supplies the same customers as the previous company.

MSD entry criteria

You should only refer insolvency cases to MSD where civil recovery action is taken by the Insolvency Practitioner against the director or directors.

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What you need to do

MSD referrals for insolvency cases are made by FIS Insolvency teams only.

For details about the generic operational guidance for the MSD programme see CH480100. For general information about the MSD programme for FIS see CH481360.

A link to the MSD intranet page will be available from this page in due course.