Personal Liability Notices

The personal liability notice system was introduced to act as a deterrent to abuse and losses to the National Insurance Fund. This was seen in a number of cases where the assets and the operations of an insolvent business that had run up significant tax debts were acquired by a new company operated by the existing management team that has a history of not paying National Insurance contributions due.

PLNs are now being commonly used in formal insolvency procedures where HMRC believes that that the company failure to pay tax debts was due to the neglect of fraud of company directors and senior management at the time of the failure.

Unlike PAYE debts, where HMRC only collects unpaid tax associated with payments to the company directors themselves and connected family members, in the case of NIC, the potential personal liability of the directors includes both NIC on their own salary and all the company’s outstanding NIC debts.

Therefore liability for the entire company’s unpaid NIC, late payment interest and penalties moves from the company to a company director personally.

Issuance of a personal liability notice is a highly serious matter. It is essential you contact us for experienced professional representation and to defend the interests of yourself and your family.

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