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Nick Wood, a partner within Grant Thornton's Recovery & Reorganisation practice has been appointed as the administrator to the limited companies after the successful application against one of the companies (Graz Limited) created and managed by tax solutions provider Safe Solutions Accounting Limited and Asciom Solutions Limited (Safe Solutions) which became insolvent last year.
The appointment represents the largest ever single administration application (by number of separate limited companies involved) in UK corporate insolvency history.
Tax solution provider
Safe Solutions Accounting traded as a tax solution provider, creating and managing over 1,000 UK Limited Companies for mainly, South African, New Zealand and Australian contractors working in the UK. The contractors' earnings were paid into limited companies which then paid out a salary and dividends to 'enable contractors to benefit from lower taxes'.
The administration of this scheme was under the control of Safe Solutions Accounting. In return for a weekly administration fee, Safe Solutions Accounting would complete all paperwork, manage bank accounts, make payments to contractors and calculate the tax due.
Financial difficulties
Safe Solutions Accounting first ran into financial difficulty in 2005. As a result, James Earp, a partner at Grant Thornton was appointed, under the Proceeds of Crime Act 2002, Safe Solutions management receiver in August 2005. By September of that year both he and fellow Grant Thornton partner Nick Wood were appointed as administrators of Safe Solutions Accounting.
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Nick Wood and James Earp were appointed as joint liquidators of Safe Solutions Accounting in December 2005 and it was then decided to try to put the 844 Limited Companies managed by Safe Solutions Accounting into administration because of their insolvency.
Nick Wood, from Grant Thornton's said: "This appointment represents the largest ever single administration application by the number of UK companies involved. The challenge will be to investigate and apply innovative ways of managing the process to minimise costs and overall timing in order to provide HMRC with a successful multimillion pound return".
Administration
When Safe Solutions Accounting went into administration in September 2005, the company posted a message on their website which said:
In order to protect contractors, and give us a breathing space while we are in funding negotiations, Safe Solutions [Accounting] has gone into administration. We expect this process to take no longer than a few weeks. There seems to be some confusion among our competitors about what this means, so here are some facts:
- 1. All Safe Solutions [Accounting] contractors will be paid as usual. The Limited Companies that pay your salaries and dividends are not affected. Administration helps us to guarantee these payments.
- 2. We are NOT in liquidation and HAVE NOT been dissolved.
- 3. You will be paid in the same way at the same time by the same consultant.
Please contact your consultant if you have any further questions.
*Safe Solutions International has asked Shout99 to clarify that they are not connected to Safe Solutions Accounting.
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Susie Hughes © Shout99 2006
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