This issue includes an update from our quality assurance team on the return to face-to-face visits, our response to the government's proposals to modernise the insolvency sector and a chance to have your views heard on our proposals to update and simplify our disciplinary framework.
Return to onsite reviews
In September 2021 we started to return to pre-pandemic ways of working, including on-site visits.
On-site monitoring visits provide the best opportunity for high quality interaction between insolvency practitioners (IPs) and our reviewers. They also enable reviews to be conducted in the most proportionate and effective manner for all those involved. However, if your firm is not yet equipped to accommodate visitors, we can discuss this, and in some circumstances we may be able to conduct a remote visit if there is no other safe alternative.
In order for all visits to run as smoothly as possible, it is important for the IP and key staff at the firm to be available during the visit. It’s also critical that all the information requested is available, both prior to and during the visit.
The same applies during any remote visit. While the reviewer isn’t going to be onsite, the IP and key staff need to be available during the time set aside for the review to discuss queries and turn around written responses. Failure to do so will result in the visit becoming protracted as the reviewer will have further visits scheduled in the following weeks.
We recognise that, as we emerge from the pandemic, there are still challenges to address including new COVID-19 cases and the introduction of hybrid working models. In the case of unforeseen circumstances in the days leading up to your visit, please tell us and we can agree an appropriate solution. We are flexible and on a number of occasions have moved to a remote visit at short notice where there have been COVID diagnoses in the practice.
If you have a question about your monitoring visit, please email email@example.com.
Duty to notify Secretary of State of proposed redundancies
Employers have a statutory duty to notify the Secretary of State if they propose to make more than 20 redundancies within 90 days.
Recent commentary concluded administrators could be personally liable for a failure to comply with the legislation (See R (Palmer) v Northern Derbyshire Magistrates' Court  EWHC 3013).
‘A corporate employer who fails to give the notice required under s.193 TULRCA commits a criminal offence under s.194(1) TULRCA and may be liable for an unlimited fine. Similarly, any director, secretary or other similar officer of the corporate employer can also be held personally liable for an offence under s.194(3) TULRCA, if the failure by the corporate employer to give the required notice was committed with that officer's consent, or because of their connivance or negligence.’
We wish to remind insolvency practitioners to ensure compliance with this legislation; failing to do so could leave them criminally liable.
Watch our recent webinar: Dealing with employees, their claims and interactions with Redundancy Payments Service. For more information on this and other employment related insolvency requirements.
IPs and Plastic Packaging Tax
HMRC is hosting the following webinars for IPs on the operation, administration and technical aspects of the Plastic Packaging Tax.
The first webinar will explore how the tax will operate including what the tax applies to, who is responsible for paying and accounting for the tax, and what information is required for your tax returns and record keeping. You can sign up to watch the webinar on 18 February at 13:45 – 14:45 or 25 February at 13:45 – 14:45.
This webinar will cover how to claim tax credits, the allowable sources of recycled plastic, methods for calculating or evidencing recycled plastic content and the weight of packaging components, and supply chain responsibilities. You can sign up to watch the webinar on 22 February at 9:45 – 10:45 or 28 February at 13:45 – 14:45.
HMRC bulletins for insolvency practitioners
HMRC has recently published the following bulletins (note two of these are updates to existing bulletins):
Guidance on the new dedicated Account Manager for insolvency related customs has been updated to include some background on Customs, its responsibilities, and a list of the taxes/duties it covers.
Updated guidance from HMRC for IPs or their agent's seeking appointment in insolvency cases where there are no tax compliance issues or active HMRC investigations.
HMRC continues to see instances where insolvency practitioners incorrectly deny or reduce HMRC’s claim when considering it for voting purposes in a decision procedure, particularly where the insolvent person or others may dispute the amount due to HMRC.
Reminder for using the new mailbox for insolvency related cases
Following the launch of the new mailbox firstname.lastname@example.org, HMRC have received a significant number of case queries and would like to issue a gentle reminder around the criteria for using the mailbox.
HMRC have asked that you use this route only when contacts via the normal channels have failed to elicit a response, despite repeated attempts. It asks that in every case, whether that may be Option 1 or 2, the contact form is completed providing full details of your query and this is attached to your email. Without a contact form, HMRC will be unable to deal with your query. No additional attachments are required and the response time continues to be 15 working days.
All of HMRC’s bulletins are available at icaew.com/talkinsolvency.
Insolvency reform overdue but regulator proposals “potentially damaging”
ICAEW has welcomed government plans to modernise regulation of the insolvency sector but raised concerns about the transfer of responsibilities from professional bodies to a new single regulator.
What’s the fuss about file notes?
During a recent ICAEW Restructuring and Insolvency Roadshow, Michelle Butler, partner at The Compliance Alliance, talked about why file notes are so important, how timing is everything, and the need to create a culture of documentation.
Quality assurance monitoring: view from the firms
All firms and IPs are asked to complete a survey anonymously after their review. We use the findings from these surveys to support the continuous improvement of our monitoring processes and procedures. The feedback is received and compiled by an independent survey company.
Read the latest feedback from firms/IPs in respect of the conduct of Quality Assurance reviews carried out in 2021.
Give your view: changes to ICAEW’s disciplinary framework
The ICAEW Regulatory Board (IRB) has started a consultation process on its proposed changes to the ICAEW’s disciplinary framework that it has planned for 2022. The documents that are subject to the consultation are the product of a two-year project to update and simplify the current disciplinary scheme, so it is more accessible for its users. The project also aimed to separate the obligations and duties of ICAEW members, affiliates, students and firms from provisions that set out the processes they should follow. The IRB wants to make improvements to aspects of the current process to ensure that it works more effectively and efficiently, while continuing to operate in the public interest.
Save the Date
Insolvencies in the energy sector
Join Matt Higgins of FRP Advisory on 14 March at 14:00 to explore the issues with which IPs may have to deal when appointed over an energy supplier. For IPs that may not deal with such insolvencies, the webinar is of general interest as this is a sector attracting press and Government commentary. The webinar may also provide some useful tips when dealing with the press, public, and those sectors involving individual consumers. Keep an eye out for further details.
Restructuring and Insolvency virtual conference
ICAEW's annual conference supporting financial professionals working in restructuring and insolvency will be held on 28-29 June. View the highlights from the 2021 programme.
Consolidate your insolvency licensing with ICAEW
By choosing ICAEW as your single regulator, we can reduce the administrative burden and provide your current and future IPs with a wealth of benefits and support.