Question to the Department for Business and Trade:

To ask the Secretary of State for Business and Trade, what discussions she has had with HMRC on a recent change of a policy on the way in which HMRC deals with those individuals who are both directors and employees for redundancy payment purposes in the event of a company going into liquidation.

It is the Insolvency Service’s Redundancy Payments Service (RPS) that processes redundancy claims from employees of companies in liquidation.

In order to determine whether a company director is also an employee and entitled to payment from RPS, the relationship with the employer is reviewed. It has always been the case that a claimant must have been an employee of an insolvent employer to qualify for payment. RPS must protect the National Insurance Fund and not make payments to individuals who do not qualify. We therefore ask all directors to provide proof to support their claim that they were an employee.

Guidance on director claims can be found at Gov.uk - director claims.