HMRC Guidance on relating to CVL appointments
This article forms part of a series looking at the significant changes to insolvency procedures being brought in in Scotland from 6 April 2019. In this article, David Menzies looks at guidance from HMRC relating to the creditors appointment of a liquidator under a CVL.
The Insolvency (Scotland) (Receivership and Winding Up) Rules 2018 (ISRWUR 2018) will significantly change the way in which a liquidator is appointed in a CVL.
The changes reflect changes introduced under Part 6 of the Insolvency Rules 2016 in relation to Creditor Voluntary Liquidations (“CVLs”) in England and Wales. These changes led to challenges for HMRC being able to formally engage in the deemed consent process for meetings called under S100 IA 1986. More specifically, IR 6.14(3) allowed for the decision date pertaining to the decision of the creditors on the nomination of a liquidator, to be as little as three business days after the notice is delivered. Those within HMRC dealing with ongoing enquiries found that although the notifications were being received into the department, very often they failed to reach the relevant HMRC officers in time for them to actively engage, and they were unable to trace if and where the notification had been made.
Furthermore, changes to the way in which notices are now advertised in the Gazette meant that HMRC were no longer able to monitor companies entering into CVL in advance, and so review, for the purposes of determining if HMRC should engage in the process in the same way as the department was able to in relation to meetings called under S98 IA 1986, prior to the Insolvency Rules 2016 being introduced.
To remedy this, HMRC proposed that the initial pre-appointment notifications for the deemed consent or virtual meeting procedures for all CVLs were provided to a designated HMRC mailbox that was set up and provided for IPs specifically in relation to CVL notifications only. This provided more clarity for IPs in terms of where to forward all notifications, and successfully ensured HMRC actively engaged in the process when appropriate.
With the introduction of ISRWUR 2018, HMRC is requesting that CVL notifications concerning nominations for appointment as liquidator in Scottish cases commence using the mailbox with effect of 6 April 2019.
HMRC have requested that the subject line of the email should include the company name, Company Registration Number and the decision date.
Please note that the mailbox is only for the initial pre-appointment notifications under the deemed consent or virtual meeting procedures.
HMRC will monitor use of the mailbox to ensure it is only used for its intended purpose, and where issues arise, will bring them to the profession’s attention. Similarly, if you experience any issues with the mailbox, please let us know and those issues can then be reviewed by HMRC.