INS10439 - VA failure
What to do when told the VA has failed
When you are told an arrangement has ‘failed’
- Find out exactly what is meant.
- Look at the
- original proposal
- approved modifications shown in the
chairman’s report. They are part of the approved
arrangement.
- Decide which ‘failure’ it is:
default, material failure, or termination.
- Find out if there is any post-VA HMRC
(Direct and Indirect Taxes) debt. The supervisor needs to be told
about it, but whether or not there are post-VA debts determines
which team takes the next action:
If there is HMRC post-VA debt
Refer the case to Post-VA Monitoring Support Team (PMST) to
take action.
If there is IR only or no post-VA debt
The Monitoring Team takes initial action when there is Direct
Taxes only or no post-VA debt.
The ‘default’ or ‘material failure’
procedures in the Monitoring Teams and the Post-VA Monitoring
Support Team are very similar.
Each team deals with each case on its merits
- Some arrangements allow remedial action even after
material failure
- The terms of each VA determines the options
- Many arrangements just require the supervisor to
hold a meeting of creditors or to commence bankruptcy or winding-up
action.
Details of the action taken within the teams is not included in
this manual (see the desk guidance held on the Team).
