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Can a non-trading business still be taxed?

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To cut a long story short, I set up a company (myself being the only person involved) and registered for VAT on recommendation as it would apparently make me look more 'professional'.

Needless to say, the idea never took off and I got as far as designing a website. I didn't trade once.

I contacted HMRC and informed them of my situation and they assured me that it would be duly noted.

A month later, I had a tax return arrive so I called them again and was told that they 'sometimes just get sent out.'

6 months later, I had a knock at the door at home and found two officers standing at my door wanting to inspect my accounts (of which I had none.) I explained to them that the business never traded and they seemed quite happy with it all. I received a letter shortly afterwards saying that they are satisfied the business hasn't traded (in so many words.)

Two years down the line and I'm still getting 'late penalty' notices and they reckon I owe them around 4k now!

Any idea how I can get these people off my back now or will I receive letters forever? It seems a telephone conversations doesn't make the blind bit of difference.

My next question (sorry for the rant) I'm now working as a freelancer and need to register as self-employed, I've been through the motions of registering online but I'm concerned now that I'm going to run into problems.

Why are things so complicated when you try to do everything above board?

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