The court granted a short reprieve, but it's not over.
New year, new Norton financial rollercoaster, it seems. In March 2019, rumors of Norton’s untimely demise surfaced but they turned out to just that, rumors. Fast-forward to November 2019, when the company announced it was seeking investors but then quickly changed course when a single investor stepped up with the influx of cash it needed. Now, in January 2020, we have news that Norton CEO Stuart Garner is working with Her Majesty’s Revenue and Customs officers to resolve some £300,000 in unpaid taxes.
Garner met with HMRC at the High Court’s Insolvencies and Companies Court on January 8 to discuss the matter, according to Leicestershire Live. To be fair, Norton originally owed twice this amount but has since paid about half of it back to HMRC, with the promise of further regular payments to come.
In fact, the HMRC barrister (that’s a lawyer to those of us in the U.S.) said it was seeking adjournment of 63 days for Norton to make good on the outstanding funds, because of the good faith shown in executing payments thus far. To add another twist, Norton says that it is waiting on about £135,000 in research and development tax credits.
“They have extended the time we have to pay and agreed to the payment we have put to them. This was the formality of what we have agreed over the past few months and wraps around research and development tax credits which have been delayed,” Garner told Leicestershire Live.
“We have paid an element of the cash and the figure left is, in essence, the R&D balance. It has been frustrating that the tax credits have taken so long to come through. We have spent about £13 million in R&D in the last three-four years so it is frustrating that this has taken so long,” he continued. “There have been five new models in the past year as a result of our R&D spend.”
Read any news reports about this incident and you’ll see that the court went easy on Norton by extending the period of time the company has to pay these taxes. Entering the court that morning, Norton faced the possibility of a “winding-up order.” If you’re unfamiliar with the term, that’s where a UK entity can appeal to the court to close or “wind up” a company that cannot pay its debts. The minimum amount a company must owe for this consideration is £750 (or US $973.50)—far below the £300,000 (or US$389,400) that Norton currently owes and is working to pay back.
Norton isn’t off the hook just yet. The judge adjourned this case to February 12, 2020, so we can expect more news on the Norton tax front next month.