tax man,can i keep my house

richireland

hi everyone
need help pls
i owe the tax man 40k,i cant aford to pay this,can i keep my house,as its rented out?
any help would be great guys

RichOneday_2

If you can't pay and you can't come to an arrangement with HMRC they will make you bankrupt. They are the only creditor you can rely on to do so.

If you are forced into bankruptcy it then depends whether you have any equity in the property. If there's no equity you it is unlikely the OR would be interested and you will keep it. Otherwise, if there is equity, the OR will want it sold.

RAS

I am assuming that this is a house that you own but rent out to others?

If there is any equity, you can buy it back from the OR, as long as your I&E permits this.

richireland

yes its my house and i rent it out
i have a morage of £189k and its worth about 200k thats if it sells in todays market

RichOneday_2

In which case by the time HMRC get round to bankrupting you there is every chance there won't be any equity.

There are no guarantees as it is down to the individual OR, but basically you should be trying to collect evidence showing no equity ie sales in the local area, asking prices etc.

Another possibility is that HMRC may go for a charging order on the property instead (they will if they've got any sense). This will then just sit there as a £40k debt to be repaid out of the eventual proceeds of the property sale, whenever that may happen even in 25 years time.

RAS

So in today's market, the chances are that the equity is bordering on nil after factoring in fees and costs?

Where are you living at the moment? What would happen if you moved back in?

Rikki

RichOneday wrote: »

In which case by the time HMRC get round to bankrupting you there is every chance there won't be any equity.

There are no guarantees as it is down to the individual OR, but basically you should be trying to collect evidence showing no equity ie sales in the local area, asking prices etc.

Another possibility is that HMRC may go for a charging order on the property instead (they will if they've got any sense). This will then just sit there as a £40k debt to be repaid out of the eventual proceeds of the property sale, whenever that may happen even in 25 years time.

Does this amount increase because of interest? Some charges do.

richireland

yes i was going to ask about interest
am living in ireland at the mo,my girlfriend owns a plot of land that we started to build on,is this safe as its not mine?

RichOneday_2

No a charging order is for an absolute amount. There will be daily interest added up to the charging order date, but then it becomes an absolute and effectively whittles away with time due to inflation.

RAS

richireland wrote: »

yes i was going to ask about interest
am living in ireland at the mo,my girlfriend owns a plot of land that we started to build on,is this safe as its not mine?

depends if you are held to have any beneficial interest in that property.

You really do need proper advice on this, not just forum help.

richireland

should i then go back to them,would they tell me what they have in mind what they are going to do
do you think if i put the house on the market they wouldnt put am charging order on it