You can read about the surcharge system for repeated missing of deadlines for your VAT returns here
. If you don't submit them at all, HMRC will issue their own estimates of your liability so one way or another they will come after the company for payment. You would be better off submitting the returns and trying to negotiate a payment plan, though that can be difficult with Customs.
HMRC will normally only pursue a director for payment of a company VAT debt if they suspect fraudulent behaviour as opposed to a situation like yours where you simply haven't submitted VAT returns. Read about that here
. However, as you will read here
, the non-submission of VAT returns can be seen as VAT evasion and that will get the Serious Organised Crime Agency. I doubt that would happen in your case.
As far as letting the company go is concerned, this will not be a problem if the directors do everything properly and above board including complying with deadlines for official forms and returns but they can be held personally liable for company debts including VAT in the circumstances outlined here
. Individuals can also be disqualified from acting as directors if their management of the company is seen as making them not fit to hold such a position with another company.
If I were you, I'd submit the VAT returns to establish the liability to avoid HMRC coming up with their own figures and making the situation worse than it is. I'd also consult a liquidation specialist fir more detailed advice on your options as far as letting the company go is concerned. Companies go under every day for legitimate reasons with a loss of VAT and other taxes but HMRC don't pursue the directors in every case. It comes down to the way they perceive the company has been run , what resources they have and how much is owing.
I hope this helps but let me know if you have any further questions.