In The News

UK Tax Authority To Be Preferred Creditor

Global Restructuring Review

30 Oct 2018
Reprinted with permission

The UK government’s plan to make its tax collection authority, Her Majesty’s Revenue & Customs (HMRC), a secondary preferred creditor in insolvencies was a surprising decision that will have a negative impact on unsecured creditors, according to Howard Morris in the Global Restructuring Review article “UK tax authority to be preferred creditor.

“I think generally people have been surprised by this, it hadn’t been trailed by HMRC,” he said. “One can see their logic, but it means unsecured creditors will get that much less.”

On whether it will now look to push for winding-up distressed companies, Mr. Morris suggests, “It could make HMRC more aggressive and less co-operative.”

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