HMRC update: Britons urged to pay ‘as quickly as possible’ as tax debt collection restarts

HMRC explains the hidden economy and its impact on society

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HMRC’s processes were somewhat hampered by the COVID-19 crisis, but as restrictions ease, it will be restarting debt collection work. It has said it will take an “understanding and supportive” approach, helping people to pay their taxes as soon as possible. Those who have tax debt can expect to be contacted by phone, post or text message with the details of what they have to pay, and how to move forward. 

HMRC has urged individuals to respond to this correspondence as soon as possible, as the Revenue may consider non-communication as refusal to pay.

It added: “In all cases, we want to work with customers to find a way for them to pay off their tax debt as quickly as possible, and in an affordable way for them.

“Everyone is different, so the support we offer varies from customer to customer. 

“For instance, we can discuss affordable payment options, such as a payment plan where customers pay what they owe in affordable instalments.”

HMRC has stated that at any one time, it has half a million arrangements in place at any one time, with more than nine out of ten completed successfully.

But if customers are unable to pay anything straight away, they should not be concerned.

The Revenue has said that by opening up the discussion, it can understand a person’s circumstances better and offer to help.

This kind of assistance may come in the form of a short-term deferral, which means nothing is required in the form of payment for a set period of time. 

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This would mean no further action is taken to collect the tax debt within this grace period. 

But in the same sense, a warning has been issued to those who refuse to cooperate or communicate with HMRC.

The Revenue has said it may visit a person at their home or business address to chase the tax debt, while following COVID-19 guidance.

It explained: “From September 2021, where customers are unwilling to discuss a payment plan, or where a customer ignores our attempts to contact them, we may start the process of collecting the debt using our enforcement powers.

“These powers include taking control of goods, summary warrants and court action including insolvency proceedings.

“We only use them as a last resort and we take great care to use them fairly and carefully.”

The Revenue has, however, vowed to offer people additional support on their tax debt should they need it.

In particular, it has specifically set aside help for those who have mental health issues or emotional distress.

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It works with organisations such as Mind and the Alzheimer’s Society to achieve this goal.

But Britons have also been advised to look further into a new scheme currently being offered by the Government in England and Wales.

This is known as the Debt Respite Scheme, designed to help people struggling to cope with the money they owe.

Here, customers will be able to apply to a debt adviser for “breathing space” to deal with their debts – where creditors will stop enforcement activity and all interest for 60 days. 

Britons will be able to access the service online through the Government’s official website. 

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