Don't annoy the tax-man.

Apr 09, 2006 4 Replies
K

The sole director of a small Ltd company sacked an employee for "lying about having Multiple Sclerosis", and refused to pay £400 SSP outstanding at the time of the sacking.



The Inland Revenue's statutory payments team investigated, ruled that the employee was genuinely ill, was entitled to the SSP, and formally directed that the company pay the £400.



The director refused to accept the formal decision, and three months later the Inland Revenue paid the £400 directly to the employee, judging the director to be a "Defaulting Employer".



Out of morbid curiosity, what are the consequences for the Company and Director of being labelled "Defaulting"? Is it really not a Good Idea to upset the tax man that way?



thanks


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T

Generally, it is a bad idea to annoy the IR (though traditionally Customs and Excise are even more dangerous to upset).

It sounds like the employer has got off lightly in any case - I'm surprised the employee didn't sue under the Disability Discrimination Act.

Thom

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K

In message , Thom writes

She is, the tribunal's in May, I was just wondering if the IR would fine or close the business, or otherwise make it pointless to continue with the Tribunal.

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T

I'm don't know, though it is likely the director in question would be jointly liable under the DDA, so even if the comapny closed the case could still be pursued.

Thom

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S

I don't know whether there are any penalties in this particular case. However HMRC (or IR as it used to be) have no powers to 'close the business'.

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