IDG40660 - Sharing information outside of HMRC: disclosure in insolvency cases: pro-active disclosures to a trustee in bankruptcy

Where you become aware that the bankrupt individual has assets that have been hidden or withheld from the trustee you may be able to disclose information that will help the trustee to recover these assets in certain circumstances.

It will be lawful to make a disclosure to the trustee where the making of the disclosure leads to a realistic chance of the department increasing its recovery from the bankruptcy. If this is the case, it can be shown that the information will have been disclosed for the purposes of HMRC’s functions (seeIDG40000).

Where the making of the disclosure is unlikely to make any material difference to the department’s recovery then a disclosure cannot be made as it will not be for the purposes of the department’s functions.

When considering a proactive disclosure you must ensure that the reasons behind the disclosure are properly recorded. For disclosures relating to insolvency matters a digital form is available to record the decision making.

When considering a proactive disclosure you must ensure that the reasons behind your decision are properly recorded. Your note may need to consider factors such as:

• the level of the department’s claim
• the total of other claims on the individual’s assets
• how difficult it will be to recover the asset
• the trustee’s success rate in recovering assets and paying dividends
• fees likely to be charged by the trustee
• the likelihood of the department making a recovery as a result of the disclosure.

You should judge each case on its merits and, in cases of doubt, seek further guidance from your Security & Information Business Partner (SIBP).