HMRC’s decision to require security for PAYE and NIC liabilities from three companies with the same sole director and shareholder was reasonable based on the track record of outstanding liabilities in respect of businesses under the ownership, control, or influence of that individual.  

The three appellant companies (A, B, and M) were formed in September 2015 and registered for PAYE in early 2017. The same individual (SAG) was the sole director and shareholder of all three companies. A and B took over businesses formerly operated by SAG, and M took over the business of a company (LH) of which SAG was also the sole director and shareholder.