A growing practice, known as ‘phoenixing’, is costing HMRC millions in lost tax revenue, the Financial Times reports.
The term refers to the tactic of repeatedly liquidating a limited company and then re-registering under a new name, sometimes deliberately, to dodge tax bills and other debts. One visible example might be the constant churn of sweet shops on Oxford Street.
The impact of this phenomenon on HMRC is significant. In the 2022–23 tax year alone, phoenixing companies accounted for an estimated £836 million in lost revenue—the most recent year with available data.
What is phoenixing?
Phoenixing is a phenomenon where company directors liquidate a failing business and immediately set up a new one under a different name….