DMBM656170 | Enforcement action: distraint: after the levy: the effects of insolvency following distraint

From HM Revenue & Customs · Debt Management and Banking Manual

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Effects of insolvency on distraint

Insolvency includes

Companies

Administration DMBM656190

Compulsory liquidation (or winding up) DMBM656220

Voluntary liquidation (or winding up) DMBM656210

Administrative receivership DMBM656180

Company voluntary arrangement DMBM656200

Individuals

Bankruptcy DMBM656220

individual voluntary arrangement DMBM656200

Deceased insolvent estates

deeds of arrangement

Partnership

Insolvent Partnership Order 1994 DMBM656220

partnership voluntary arrangement DMBM656200

If the case has already been handed to the auctioneer, he will liaise with you and will retain the papers until your course of action becomes clear.Partnership

The guidance in the following paragraphs summarises the action to take if either insolvency occurs, or a voluntary arrangement is proposed, after you have levied distraint but before you have completed the distraint by sale. These actions will depend on the particular circumstances of the case and the type of insolvency involved.

Any questions regarding undertakings and correspondence in general should be conducted between HMRC and the insolvency practitioner. If the goods are with the auctioneer he should not enter into correspondence or discussions with the practitioner.

In order that the Department’s position is not prejudiced do not refer the case to ICHU for proof to be lodged until the distraint is resolved.

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Providing information to the liquidator

The Information Disclosure Guide gives details of what information you may disclose to the liquidator. Disclosure should be limited to information the company would normally be aware of itself. This includes details of the sale proceeds at auction, whether in total or by individual item (which you will have to obtain from the auctioneer).