Author: Glenn

If you cannot pay your tax bill, it’s crucial to contact HMRC as soon as possible. They may offer support through a Time to Pay arrangement, allowing you to repay your debt in instalments based on your financial situation. Ignoring the debt can lead to enforcement action, including visits to your home or business by HMRC or the use of debt collection agencies. The debt collection agencies are regulated by the Financial Conduct Authority and will only contact you by letter, phone, or SMS. They will not visit you in person at your home or place of work.

If these measures to do not work, HMRC can recover the debt using more serious measures. These include taking control of your possessions, recovering money directly from your bank account, adjusting your tax code or using court action. HMRC may also pursue debt through charging orders, deductions from wages or pensions or third-party debt orders.

If all else fails, insolvency proceedings may be started, including bankruptcy or winding-up orders. HMRC also has international recovery agreements that allow foreign tax authorities to collect UK tax debts if you live or have assets abroad.

If you are affected by any of these issues, please let us know so we can help you.

Under the Companies Act 2006, dividends can only be paid from realised profits, never from capital, no matter what a company’s Articles of Association say.

Dividends can only be paid by a company out of profits available for distribution, not from capital, even if the company’s Articles of Association suggest otherwise. This rule is established under Companies Act 2006, section 830, and forms a key legal restriction on dividend payments.

Profits available for distribution are defined as a company’s accumulated, realised profits (from both revenue and capital), not previously distributed or capitalised, minus its accumulated, realised losses, provided these losses haven’t already been written off through a formal reduction or reorganisation of capital.

HMRC’s internal manuals go further and state that the Act lays down what may be termed the ‘balance sheet surplus’ method of determining profits available for distribution. Under this, a company can distribute the net profit on both capital and revenue at the particular time, as shown by the relevant accounts.

Additional rules apply to certain types of companies including investment and public companies.

Company directors have a legal duty to act responsibly and in the best interests of their business. If a director fails to meet these responsibilities, they can face disqualification from acting as a company director for up to 15 years.

Disqualification can result from ‘unfit conduct,’ which includes actions such as trading while insolvent, failing to maintain proper accounting records, neglecting to submit statutory accounts to Companies House, not paying taxes or using company money or assets for personal benefit. It can also occur if a director is subject to bankruptcy or a Debt Relief Order.

The disqualification process typically begins when The Insolvency Service investigates a company involved in insolvency proceedings or responds to complaints. If misconduct is suspected, the director will be informed in writing and given the option to either defend the case in court or voluntarily accept a disqualification through a formal disqualification undertaking. Other authorities including Companies House, the courts or a company insolvency practitioner can also initiate disqualification proceedings.

Once disqualified, an individual cannot be involved in forming, marketing or running a company or be a director of any company registered in the UK or an overseas company that has connections with the UK. Breaking these rules can lead to a fine or imprisonment. Disqualified directors are listed on public registers maintained by Companies House and The Insolvency Service.

1 September 2025 – Due date for corporation tax due for the year ended 30 November 2024.

19 September 2025 – PAYE and NIC deductions due for month ended 5 September 2025. (If you pay your tax electronically the due date is 22 September 2025)

19 September 2025 – Filing deadline for the CIS300 monthly return for the month ended 5 September 2025. 

19 September 2025 – CIS tax deducted for the month ended 5 September 2025 is payable by today.

1 October 2025 – Due date for Corporation Tax due for the year ended 31 December 2024.

19 October 2025 – PAYE and NIC deductions due for month ended 5 October 2025. (If you pay your tax electronically the due date is 22 October 2025)

19 October 2025 – Filing deadline for the CIS300 monthly return for the month ended 5 October 2025. 

19 October 2025 – CIS tax deducted for the month ended 5 October 2025 is payable by today.

31 October 2025 – Latest date you can file a paper version of your 2024-25 self-assessment tax return.

The Money Purchase Annual Allowance (MPAA) is a pension rule designed to prevent individuals from gaining double tax relief on pension contributions. It targets situations where someone withdraws money from their defined contribution pension pot and then reinvests it, effectively receiving tax relief on the same funds twice.

The normal annual pension contribution limit is currently £60,000. However, once the MPAA is triggered the pension contribution limit is significantly reduced to the MPAA cap of £10,000 per year.

The MPAA is triggered when you start accessing your pension flexibly, such as by:

• Withdrawing your entire pot as a lump sum (in full or in part).
• Moving into flexi-access drawdown and taking income.
• Buying a flexible annuity.
• Exceeding withdrawal limits under a capped drawdown plan.

It does not usually apply if you:

• Only withdraw up to a 25% tax-free lump sum allowance.
• Buy a lifetime annuity.
• Cash in a small pension pot of less than £10,000.

If applicable, the reduced pension allowance can affect future retirement planning and needs to be considered before making any pension withdrawals.