HM Revenue and Customs (HMRC) has issued new guidelines for all who pay taxes with a stern warning for those who don’t pay on time and support for those who struggle to meet payment deadlines.
If you can’t pay the tax you owe in full and on time, HMRC can work with you to find a way to pay off what you owe as quickly as possible and in a way that is affordable to you.
If you have a tax debt, HMRC has said it will always try to contact you to talk about your situation and agree on a course of action before taking action, but it warns that ignoring communications could have serious consequences. repercussions.
HMRC’s guidelines on GOV.UK warn: “You must respond as soon as possible, so that we know you need help and that we are not refusing to pay what you owe.”
Options available if you cannot pay your tax bill
- ask you to agree on a payment plan based on your financial situation, called a payment term agreement
- use any overpaid tax that would normally be refunded to you to settle other unpaid tax debts you have
- adjust your tax code to collect any unpaid tax debts, if you have PAYE income
- HMRC also said, “We can use our prosecution powers to collect unpaid taxes if you don’t tell us about how you’ll pay what you owe.”
What if you don’t sign up with HMRC or refuse to pay what you owe?
If you don’t respond when HMRC tries to contact you, they will visit you at your home or business address to try and work with you to settle the tax you owe.
They say it will help them understand your personal situation – for example, if you need extra support.
What happens when visiting HMRC?
- ask questions about your financial situation and your ability to pay
- try to agree on the best way to settle the debt with you, which may be to make full payment or to make installment payments.
But, don’t panic.
HMRC reassures customers that four out of five cases usually reach agreement.
What are the tax debt collection powers of HMRC and when do they use them
HMRC points out that they only use debt enforcement as a last resort if customers do not respond to communications and may be different for each country in the UK.
He said, “We will choose the appropriate powers based on your situation.”
Take your possessions to cover the debt
HMRC makes it clear that they will always notify you and offer you the option of paying what you owe before removing any of your goods.
In Scotland, HMRC can use a summary warrant for repossessions. This is a type of court order that is granted for debts.
When a summary warrant is granted, HMRC will ask a court-appointed official, a sheriff, to serve a payment fee if you owe taxes.
You will then have 14 days to:
- pay off your unpaid debt
- agree on a payment plan to pay the tax due in installments
If you do not agree with the amount of the debt, you should contact HMRC as soon as possible to explain why you think the amount is wrong.
If you have not paid the debt after the 14 days, HMRC may ask the sheriff to take what it considers the most appropriate âdue diligenceâ action.
They may use some or all of the following âdue diligenceâ actions to avoid proceeding with insolvency:
- collect the debt on a bank account – Bank stop
- Collect Debt With Your Earnings – Earnings Order
- Seizure and sale of your property – Attachment
- collect money from a cash register in a store – Money Attachment
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How to get help and support
If you are having difficulty paying your taxes, you should contact HMRC as soon as possible.
If you’re having trouble paying HMRC and other creditors, you can get free independent debt advice from the MoneyHelper website here and from Citizens Advice Scotland here.
You can also appoint a professional tax agent, friend or family member to handle your HMRC tax affairs on your behalf – read more about this here.
Find out how to contact HMRC if you are having difficulty paying your taxes on the GOV.UK website here.
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