Katona wins bankruptcy breather

Last Modified: 25 Jun 2008
Source: ITN

Kerry Katona has been given until August to pay off a massive tax bill and avoid declaring bankruptcy.

The former Atomic Kitten star was granted a reprieve by a High Court bankruptcy registrar in her battle with the taxman.

Deputy registrar Middleton gave her until August 7 to find £157,000 to pay off the remainder of a £417,000 tax bill.

The troubled star, who has been treated at The Priory for depression, was originally given ten weeks to pay up.

It has been reported that as well as being threatened with bankruptcy by HM Revenue & Customs (HMRC) over unpaid tax from 2004 to 2006, she owes £73,000 tax from 2007.

Luke Harris, representing Katona, 27, who was not in court, sought an extension to the payment deadline, saying she could not meet the full amount because of "changed circumstances".

He said she was expecting payments of £472,000 before the end of August - £291,000 for work already done.

Mr Harris said: "She is also strenuously seeking to remortgage her properties. But if the money comes in there is no need. I would ask for one final indulgence by the court."

Mr Harris had asked for the hearing to be in private because the media attention was "detrimental to her health" and involved private matters.

But the registrar said Miss Katona had provided no medical evidence to back up her application and he allowed the hearing to go ahead in public.

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