Bust Glasgow law firm Hamilton Burns went under with £600,000 debt

Tom MacLennan

Tom MacLennan

Hamilton Burns WS Ltd, the collapsed Glasgow law firm which included recently deposed SNP MP Tasmina Ahmed-Sheikh as a partner, went bust owing creditors more than £600,000, including £210,000 to the taxman, administrators FRP Advisors have now said.

FRP partners Tom MacLennan and Iain Fraser were appointed joint administrators when the firm went bust last month with the loss of nine jobs because of a steep drop in its legal aid income and “very high levels of historic debt”.

FRP have now issued a statement of proposals to creditors setting out the history of the collapse on May 23, the firm’s assets and liabilities.

It reports the company owed creditors around £638,000, including £210,400 due to HMRC, £11,000 to Glasgow City Council for business rates and more than £6,000 to Npower.

Set against assets of around £127,000, it meant a net “deficiency” of £511,000. However, the report suggests it could have been worse if HMRC had pressed harder.

It states: “HMRC are pursuing sums totalling £388,000 for arrears of VAT, PAYE and NIC which the company is unable to settle. Following discussions with the proposed administrators, HMRC agreed to withdraw its petition to enable the administration to proceed. The directors have attempted to repay these debts; however, with falling turnover levels there is insufficient cash to meet these.”

Ms Ahmed-Sheikh, a former Tory who defected to the SNP in 2000, and still a member of the SNP’s ruling national executive, lost her Ochil and South Perthshire seat at the General Election on 8 June.

She quit Hamilton Burns after being elected in 2015, but continued to declare a shareholding in her Commons register of interest and was last year the subject of a sequestration action by HM Revenue and Customs in relation to the firm.

The action was dismissed “in chambers” on the eve of a scheduled hearing in open court and she insisted at the time she had no “outstanding personal tax liability whatsoever”.

Upon taking control of the company last month, the joint administrators agreed to deals for the transfer of seven former staff comprising four directors and three trainees to two separate firms, together with certain work in progress:

Latta Law – 2 directors and 2 trainees

Moss & Kelly Solicitors (a newly launched firm) – 2 directors and 1 trainee

The remaining nine staff (2 qualified lawyers, 7 administrative staff) were made redundant with immediate effect.

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