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How to Deal with Business and Tax Debts

You need to deal with your outstanding HMRC (Her Majesty’s Revenue and Customs) debts, PAYE (Income Tax), NI, or VAT debts. because these are distinguished as priority debts. Since these are priority debts, you can be taken to court and can result in bailiffs visiting your home or business. Thus, if you don’t want bailiffs taking your goods, make sure you focus on paying it off.

The information below is intended for residents of England, Wales only.

5 Useful Tips to Help You Deal with Tax Debts

1) Check Tax Bill

Your initial step is to determine if you are charged correctly with the amount of tax that you need to pay. You must also provide the latest information or details of your income or business takings as well as the expenses. You might be overcharged with your tax bill if this isn’t right.

2) Create A Budget

You have to list down and create a budget to check how much payment you can afford. This is helpful especially when there are changes when it comes to your finance. Your budget list must include every detail of how much income you have in a month and the expenses or spending in total. The deficit or spare will then be the amount that you can intend towards debt payments.

Should you need to create a budget that suits your need to spare money for debt payments, don’t hesitate to contact us.

3) Contact HMRC

You should put regular payments on your debt. Once you created a budget list, you can come up with the appropriate amount that you can afford to pay your debt. So, do not agree with an amount that you can’t cope with to pay each month.

You can call on 0300 200 3300 to contact HMRC regarding your debt payment. Their business hours are from Monday to Friday from 8 AM to 8 PM, and on Saturdays from 8 AM to 4 PM.

4) Make Payments

After you contacted HMRC, you have to start paying your debt even when they refuse to accept what you can pay

It is better to pay in a small amount rather than neglecting your debts. Otherwise, they’ll think that you are not in focus to repay what you owe.

5) Maintain Communication

You must let HMRC know about your financial progress or struggle. You have to maintain constant communication to convey that you are not avoiding repaying your debt.

Who can advise with HMRC debt?

Business Debtline can advise on critical business claims such as HMRC and business charges and helps when creditors seek court litigation. They can assist in checking business status and determine the subsequent measures to consider.

Business Debtline is absolutely available, classified, and autonomous. Their website likewise includes models, fact sheets, and representation letters, as well as a company and family budget tool.

What happens if I don’t pay my HMRC debts?

If you take your HMRC debts for granted, including any tax credit overcharges, legal procedure can be taken upon you:

If you owe greater than £5,000 HMRC, bankruptcy measures will be imposed against you. 

Send bailiffs to collect the debt

HMRC don’t require to secure a court injunction to send bailiffs to visit your business and get your assets and devices.

If there are insufficient stocks to cover what you owe, the bailiff or also called enforcement agents can proceed to your house and take goods that will cover debt payments. If you refuse to let the HMRC officials enter your home or property, court actions can be taken against you.

Apply for a County Court judgment

HMRC can apply for a CCJ or County Court Judgment if you continue to avoid your obligations or failed to cooperate. You will be asked to fill up some forms and state for how much you can afford to pay each month. If you failed to pay CCJ, enforcement methods can be a resort to oblige you. This can include a charging order. 

Dispense a warrant to a magistrates’ court inquest

If your debt is not more than £2,000, HMRC can assign you an indictment to a hearing. You’ll need to revisit your company and family budget, to decide a proposal to pay with installments.

If you take these installments for granted, added proceedings will be directed to determine whether you should be jailed. Before this happens, you will require to be pronounced guilty of ‘wilful refusal’ or ‘culpable neglect’ wherein you have funds but just don’t feel of paying your obligations.

The court may determine not to lock you in bars but it cannot default your debt.

Start bankruptcy proceedings against you

If your debt totals more than £5,000, HMRC can resort to bankruptcy proceedings against you. 

Take away money from your wage to pay off your debt

If your working for a company or institution, HMRC can obtain debt payments by adjusting your tax code to raise the expense of tax subtracted from your monthly wage.

Take away money from your wage to pay off your debt

If your working for a company or institution, HMRC can obtain debt payments by adjusting your tax code to raise the expense of tax subtracted from your monthly wage.

Take money from your savings

This only pertains to debts greater than £1,000. HMRC also should leave a minimum of £5,000 in your savings. HMRC can secure money to pay tax and tax credit debts straight from gains contained in banks and developing society accounts. However, if your savings are below £6,000 they can’t take this step.

In the event of joint savings, the savings will be divided and 50% will be termed as yours.

Contact Us!

If you are in the tailspin of bankruptcy, you need to consider FREE DEBT HELP. Our finance experts can give you best debt management plan, it is possible to get rid of your debt in no time.  Should you wish to speak via phone, call us at  0800 193 1024 or online.