Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

HMRC gains only £14.4m in extra tax from insolvencies since regaining preferential creditor status

by July 19, 2024
July 19, 2024
HMRC gains only £14.4m in extra tax from insolvencies since regaining preferential creditor status

HMRC has collected an additional £14.4 million in tax from insolvencies over two tax years up to 2023 since it regained its ‘preferential creditor’ status.

The preferential status, known as ‘Crown Preference’, was reinstated for HMRC in December 2020, granting it priority in reclaiming taxes owed from insolvent businesses ahead of other unsecured creditors, including banks and suppliers. This change marked the return of a status HMRC had lost in 2003.

Mark Boughey, Partner in the Restructuring Services practice at Forvis Mazars, described Crown Preference as a controversial power. “This status often results in unsecured creditors, like suppliers, receiving nothing when a business goes insolvent. This is particularly detrimental to smaller suppliers who now find themselves at the bottom of the ranking during insolvency proceedings.”

Crown Preference also ranks ahead of lenders with floating charge security, leading to concerns that its reintroduction has caused banks to reduce lending amounts to businesses and increase interest rates. These adjustments reflect the heightened risk banks face of not recovering their loans if a business becomes insolvent.

Despite the intended advantages of Crown Preference for HMRC, Boughey questioned its overall efficacy given the modest £14.4 million recovered so far. “The amount of money raised through Crown Preference is surprisingly small. This money could significantly impact other creditors, particularly small suppliers.”

Boughey suggested that diverting more funds to suppliers and lenders might boost bank funding and credit lines from suppliers, benefiting the broader economy. He added, “The amount HMRC brings in through Crown Preference is expected to rise significantly in the coming years, especially with the recent increase in insolvencies. It will be interesting to see how these figures evolve.”

Read more:
HMRC gains only £14.4m in extra tax from insolvencies since regaining preferential creditor status

0
FacebookTwitterGoogle +Pinterest
previous post
Secrets of Success: Guido Ampollini, founder and CEO GA Agency
next post
Small-caps Break Out and Lead – Now What?

You may also like

UK government quietly disbands AI ethics advisory board...

September 27, 2023

Radical land tax proposal gains traction with support...

August 27, 2024

This Company is Leading the Supply Chain Revolution

September 13, 2022

Elevate Business Efficiency and Sustainability with Lift Modernization

September 2, 2024

10,000 companies removed from register for ‘illicit activities’...

June 19, 2025

The Wealthy Wayfarer: Personal Finance Tips for the...

April 21, 2024

Greggs shares fall sharply as June heatwave hits...

July 2, 2025

SME loans fall by £14bn in last year...

April 24, 2023

Unleashing the Potential of AI: Komninos Chatzipapas and...

July 11, 2023

How to keep motivated when job-hunting during winter

January 22, 2024

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Hawley opens probe into Meta after reports of AI romantic exchanges with minors

      August 15, 2025
    • Friday Feature: Braveheart Christian Academy

      August 15, 2025
    • From admiration to Alaska: A timeline of Trump and Putin’s high-stakes encounters

      August 15, 2025
    • Schumer claims Trump admin withholding Epstein files, threatens to sue

      August 15, 2025
    • UK prices for Mounjaro weight-loss jab to rise by up to 170% after Trump pressure on drugmakers

      August 15, 2025
    • UK workers rank among the world’s most miserable, survey finds

      August 15, 2025

    Categories

    • Business (8,796)
    • Investing (2,216)
    • Politics (16,392)
    • Stocks (3,228)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved