ICAEW.com works better with JavaScript enabled.


HMRC ceases providing tax clearance for members’ voluntary liquidations


Published: 08 Dec 2023 Update History

Clearance service withdrawn with immediate effect. This includes requests already received by HMRC that have not been responded to.

HMRC’s latest Insolvency Guidance on 6 December 2023 announced that HMRC will no longer provide pre- and post- tax clearances in members’ voluntary liquidation (MVL) cases. 

Instead, insolvency practitioners (IPs) must close cases without tax clearance subject to their professional judgement. 

The reason cited for this decision is that there is no statutory or best practice framework for HMRC to provide tax clearance. 

The guidance refers to various ways that insolvency practitioners could gain alternative assurance about the accuracy of the company’s tax liabilities. For the pre-liquidation period, these include: 

  • the sworn declaration made by the company’s directors of the company’s assets and liabilities;
  • any HMRC compliance checks that are in progress; and
  • claims from HMRC for pre-insolvency debt.  

In assisting with the preparation of the declaration of solvency, it is expected that IPs would establish the tax position in any event. They will be aware of the post-appointment position by virtue of being in office. 

Some insolvency practitioners will be unhappy with this development. However, it will assist the conclusion of a large number of MVLs that have been held up as HMRC did not have the capacity to process the requests for clearance.  

Given the heavily caveated terms in which clearance letters were framed, the value of obtaining tax clearance from HMRC was open to some debate.  

The Tax Faculty

ICAEW's Tax Faculty is recognised internationally as a leading authority and source of expertise on taxation. The faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.

More support on tax

ICAEW's Tax Faculty provides technical guidance and practical support on tax practice and policy. You can sign up to the Tax Faculty's free enewsletter (TAXwire) which provides weekly updates on developments in tax.

Sign up for TAXwireJoin the Tax Faculty

More from the Tax Faculty

Latest news
Making tax digital image

Stay up to date with the latest developments in tax by signing up to the Tax Faculty's weekly e-newsletter

Practical guidance

Comprehensive support for Tax practitioners each month from the Tax Faculty and expert contributors.

Technical support
Tax Faculty image

Expert advice from the Tax Faculty's technical managers on all the developments in tax policy and practice.

Open AddCPD icon

Add Verified CPD Activity

Introducing AddCPD, a new way to record your CPD activities!

Log in to start using the AddCPD tool. Available only to ICAEW members.

Add this page to your CPD activity

Step 1 of 3
Download recorded
Download not recorded

Please download the related document if you wish to add this activity to your record

What time are you claiming for this activity?
Mandatory fields

Add this page to your CPD activity

Step 2 of 3
Mandatory field

Add activity to my record

Step 3 of 3
Mandatory field

Activity added

An error has occurred
Please try again

If the problem persists please contact our helpline on +44 (0)1908 248 250