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HMRC internal manual

VAT Joint and Several Liability

Introduction: Where to obtain assistance and guidance: HMRC teams: Insolvency and Securities Team

The Insolvency and Securities Team (IST), which is located within Civil Fraud and Avoidance, a part of the Special Investigations work stream, is charged with maximising the amounts recovered from insolvencies and using civil measures to minimise the risks from non-compliant or phoenix traders.

In most insolvencies the liquidation of assets is carried out with honesty and integrity by a professional Insolvency Practitioner (IP) and HMRC do not need to intervene. These cases are processed by Debt Management and Banking, which is located within Enforcement & Compliance. However, in some cases we need to intervene because for example:

  • the IP may not be aware of the full facts;
  • we have doubts about the full extent of the tax liabilities;
  • we have concerns that the IP may not pursue any irregularities.

The common factor is the risk to the exchequer and cases like these are what IST deal with - to assess the situation and where necessary intervene and apply the most appropriate tool (PAYE Direction, Insolvency Intervention, Security, Asset Recovery).