This is a freeview 'At a glance' guide to joint and several liability notices and tax avoidance penalties.

Subscribers: go to your detailed version of this note: Joint & Several Liability of Company Directors etc

At a glance

Under measures introduced by Finance Act 2020, HMRC has new powers to issue joint and several liability notices to an individual involved with insolvent companies that have unpaid tax debts.

Joint and several liability arises where a director, shadow director, or participator (or LLP member, in the case of an LLP) is given a notice in respect of:

(a) Tax avoidance and tax evasion cases

(b) Repeated insolvency and non-payment cases

(c) Cases involving penalty for facilitating avoidance or evasion

(d) Schedule 16 FA 2020: coronavirus


When a joint and several liability notice is given, the individual and the company are made jointly and severally liable for the debt, unless the company no longer exists, in which case the individual is wholly responsible for the debt.

The aim is to ensure fairness across the tax system and there are rights of appeal.

Under these provisions, an LLP is treated as a company and an LLP member is treated as a director or participator.

Useful guides on this topic

Insolvency FAQs for directors
This guide considers some common FAQs that directors may have about insolvency situations.

Joint & Several Liability of Company Directors etc
Subscriber guide describing the circumstances where a joint and several liability applies, together with examples, HMRC's interpretation and links.

Tax Avoidance Schemes
Tax avoidance is heavily targeted by HMRC, but how do you spot tax avoidance schemes? What are the types of schemes available that should be avoided? What disclosure requirements are there? When are tax clearances needed?

DOTAS: Disclosure of Tax Avoidance Schemes
What are the Disclosure Of Tax Avoidance Schemes (DOTAS) rules? When should you disclose your use of a tax avoidance scheme? What are the consequences of non-disclosure? How are penalties calculated?

Penalties: DOTAS
This is a freeview 'At a glance' guide to the Disclosure of Tax Avoidance Schemes (DOTAS) regulations.

Promoters of Tax Avoidance Scheme (POTAS)
Who is a Promoter? What are the Promoters of Tax Avoidance Scheme rules?  What does this mean for promoters, intermediaries and clients?

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