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HMRC increase the pressure to pay tax on time

Changes to legislation in recent years, some of which have only recently been introduced,  have enabled HMRC to take more aggressive steps to make sure that those who they believe should be paying tax, do indeed do so. Examples include the ability, subject to certain caveats, to do any of the following:

  • Withdraw funds from tax payers’ accounts
  • Demand security for PAYE/NI from employers who retain funds due to the Crown
  • ‘Take Control of Goods’ and sell them to use the funds to settle their debts, this replaces the old ‘distraint’ legislation
  • Demand immediate payment for tax saved by certain tax avoidance schemes pending investigation

Whilst these initiatives may have grabbed the headlines a recent report  suggests that the number of winding up petitions issued by HMRC has begun to rise again. The number issued in the year to 31 March 2014 rose to 4,147 from 3,733 in the previous year, an increase of 11%.

HMRC’s clear message is that where tax is due they intend to ensure it is paid on a timely basis and if necessary will use their  powers to enforce payment, even if it means forcing a company out of business or petitioning for a taxpayer’s bankruptcy. They will however contemplate requests for ‘time to pay’ on the basis of full and frank disclosure, but time will be limited, and all agreed payments must be made on time along with all future taxes.

Whilst HMRC’s focus will be on their debt being repaid it is essential that any payment plan agreed with them permits you to  settle any other debts you may have on a timely basis.  A  full  review of your financial position,  with professional advice as appropriate,  should be undertaken to ensure that the successfully negotiated settlement of one debt is not followed by legal action in respect of another.



Date: 25th July, 2014
Author: Peter Godfrey-Evans


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Courtney Halifax features in Lexis Nexis re: changes to Principal Private Residence relief and lettings bill……

Well done to our tax team!…



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