INS10443 - VA failure

Is funding appropriate?

Funding not appropriate?

Funding is not appropriate, even to stop further accruals of post-VA debt

• When HMRC will not recover its costs
• Resistance by the debtor is likely to increase the costs significantly, or
• To the extent that a supervisor has used funds that should have been set aside for petition costs to pay other lower priority costs of the arrangement.

In these circumstances the correct action is

• To ask Indirect Taxes or Debt Management Service to issue a statutory demand for post- VA debts only, then file a Section 264(1)(a) IA1986 petition, or
• For PMST to file Direct Taxes own Section 264(1)(c) IA1986 petition based on the failure of the VA
• (This text has been withheld because of exemptions in the Freedom of Information Act 2000)

Funding is appropriate?

Agreement to funding is only appropriate when

• You expect to recover costs advanced
• VAS is a major creditor and expects to receive the major part of realisations in bankruptcy or liquidation
• The supervisor has accounted for the full costs retention required under the arrangement from VA funds actually received.

For action to take for funding legal action see INS10445.