Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Unexpected problems

24 October 2014
Issue: 4475 / Categories: Tax cases , PAYE , Employees , Income Tax

PSC Photography Ltd (TC4039)

The taxpayer company’s business was mainly photographic work for high street retailers. It began a project for TR Lewin in November 2011. The main part was due to start in February 2012 but it was postponed to May and then cancelled.

The situation was a setback for the taxpayer which taken on extra employees who had to be paid in spite of doing no work.

The taxpayer’s bank then decided to change arrangements. It reduced the company’s overdraft from £125 000 to £90 000 and demanding monthly repayments of £10 000.

The firm was unable to comply leading the bank to cancel the overdraft facility and impose a monthly payment of £5 550.

The taxpayer was forced sell its premises to repay the bank and had to trade without outside finance all the while remaining responsible for PAYE.

Financial problems meant the company was late making...

Only subscribers may read the full article

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.
back to top icon