We are regularly contacted by Directors & Owners in need of HMRC debt management advice, as the HMRC have significant systems and resources to chase unpaid tax. The directors usually can’t pay corporation tax, can’t pay VAT or can’t pay PAYE – often signs of insolvency; resulting in HMRC debt payment demands that stress legal action and even winding up. A very worrying situation that we are familiar with and can help with.
To help understand HMRC debt management, broadly, below is the HMRC Debt Recovery & Collection Process as it escalates:
- HMRC Debt Payment Demand Letters / Calls (negotiate a Time To Pay arrangement)
- HMRC Enforcement Notice* (7 days to pay – Time To Pay arrangements may no longer be possible at this stage)
- HMRC Enforcement Officer / HMRC Bailiff Visit* (assets removed or Controlled Goods Agreement (a Distraint) made, 7 days to pay)
- HMRC Enforcement Officer / HMRC Bailiff Goods Enforcement Visit* (assets removed for auction)
- Legal Action (CCJ / Statutory Demand / Winding Up Petition)
- Compulsory Liquidation
*There is a cost to enforcement that’s added to any unpaid tax debt.
** It’s a criminal offence for Directors to sell goods in a Controlled Goods Agreement.
All HMRC Debt Management Solutions: