Revenue & Customs can now ask certain businesses to pay a deposit if they believe there is a serious risk that a firm may fail to hand over their PAYE deductions or National Insurance contributions reports This Is Money.
The Revenue intends to levy the charge to ‘target those employers who have a record of using bankruptcy or phoenixism’, where directors carry on the same business under a new company name, enabling them to walk away from their debts.
John Davies, head of technical at the Association of Chartered Certified Accountants, says: ‘The security required will vary from case to case, depending on the amount of tax at risk and the previous behaviour of the employer. ‘Employers can appeal against the decision. If security is not provided employers can be prosecuted by the Revenue.’