CH282230 - Director disqualification: types of misconduct

Typical misconduct might include but is not limited to:-

Failure to comply with tax and company obligations e.g.

• Tax
• Deliberate Submission of false information to HMRC
• Failure to register, failure to file Returns or failure to file accurate Returns
• Failure to operate PAYE
• Deliberate non-payment of HMRC liabilities
• Payments on assessments for prolonged period which are substantially less than true debt
• Fraud, such as under declaration/ suppression of taxes by failing to record sales
• Deliberate tax avoidance/ breach of DOTAS legislation
• Companies Act
• Failure to file documents at Companies House
• Failure to submit statutory returns over a 2 year period

Not acting in best interests of the company e.g.

• Putting personal gain before the profits of the company (conflict of interest)
• Illegal dividends
• Personal enrichment/ excessive benefits
• Transactions at an undervalue (e.g. company assets gifted to director)
• Dissipating assets/ removal of assets
• Assets disposed of when aware of insolvency

Trading with knowledge of insolvency and/ or phoenixism

Transactions to the detriment of creditors

• Preferential payment (favouring one creditor over another)
• Misfeasance - a misuse, neglect or abuse of duty of care to the company and its creditors by the director
• Treating one creditor unfairly
• Putting assets out of reach of creditors
• Contrived liquidation to avoid liabilities

Records

• Record disposal of dubious nature
• Fraudulent Accounts - deception/ suppression/ off record accounts
• Failure to maintain/ preserve/ produce accurate records so cannot evidence reason for transactions
• Poor record keeping - suppression of tax/ inability to assess
• Deliberate provision of false information

Actions

• Bad practices allowed to continue - weakness in systems and processes
• Sham or Nominee directors - legal director not controlling mind
• Repetition – continued failed companies/ serial phoenixism