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Can HMRC take my house?

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Hi all, I'm asking this for a family friend, so I don't have all the specifics....but a summary of the issue is -

FF is an employer, who has one employee on their books as a personal assistant, they do not own or operate a business in any sense. Somehow (while paying a payroll company to ensure tax has been paid correctly) they've managed to amass a debt of in the region of twenty thousand pounds. Apparently the HMRC want it paid now and FF obviously can't put their hands on that amount of money over night and will probably need to take a loan against their home to pay the money back...

So my question is - what can HMRC do to get the money back? FF has no assets what so ever, and is on a very low income also, and the amount they could afford to pay back monthly would do nothing to repay the debt and thus HMRC have threatened court action.

Does anyone know what HMRC can actually do to get the debt paid off in this situation?
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  • purdyoaten
    purdyoaten Posts: 1,159 Forumite
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    Some years ago HMRC changed their whole approach to debt collection in that they expected the taxpayer to regard them as any other business to whom a debt was owed. In coming to an arrangement HMRC now ask for full details about one's financial position - including equity on a house.

    In short, HMRC will expect you to use whatever means are possible to you to raise the money. If that means that you have to raise money secured against your house - so be it!
    There are 10 types of people in the world - those who understand binary and those who do not. :doh:
  • xylophone
    xylophone Posts: 44,765 Forumite
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    FF is an employer, who has one employee on their books as a personal assistant, they do not own or operate a business in any sense.
    Am I being dense or is there a contradiction there?

    And similarly
    and will probably need to take a loan against their home to pay the money back...
    FF has no assets what so ever,


    And what responsibility does the payroll company bear in the matter?
  • zaax
    zaax Posts: 1,910 Forumite
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    Yes. You need proper financial advice now otherwise you maybe sleeping on the streets
    Do you want your money back, and a bit more, search for 'money claim online' - They don't like it up 'em Captain Mainwaring
  • agrinnall
    agrinnall Posts: 23,344 Forumite
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    xylophone wrote: »
    Am I being dense or is there a contradiction there?

    And similarly






    And what responsibility does the payroll company bear in the matter?

    No. Yes. Good question!
  • Savvy_Sue
    Savvy_Sue Posts: 46,216 Forumite
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    I am wondering if FF is disabled, and has been employing a personal assistant to help with care / admin / whatever.

    In which case, if direct payments from the local authority are involved, I'd be talking to them about how this has happened.

    It is possible that the payroll company have been preparing the paperwork for what needs to be paid to HMRC but not actually paying it. And there may be a misunderstanding about whose responsibility that is.

    Or it is possible that the payroll company have royally screwed up ...
    Signature removed for peace of mind
  • purdyoaten
    purdyoaten Posts: 1,159 Forumite
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    echo84 wrote: »

    will probably need to take a loan against their home to pay the money back...

    FF has no assets what so ever

    This is the discrepancy that I couldn't get my head around!
    There are 10 types of people in the world - those who understand binary and those who do not. :doh:
  • purdyoaten
    purdyoaten Posts: 1,159 Forumite
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    Savvy_Sue wrote: »
    I am wondering if FF is disabled, and has been employing a personal assistant to help with care / admin / whatever.

    In which case, if direct payments from the local authority are involved, I'd be talking to them about how this has happened.

    It is possible that the payroll company have been preparing the paperwork for what needs to be paid to HMRC but not actually paying it. And there may be a misunderstanding about whose responsibility that is.

    Or it is possible that the payroll company have royally screwed up ...

    That had crossed my mind - used to be called 'Q' schemes many (too many) years ago. Not necessarily for the disabled - persons with nannies, for example.

    http://www.hmrc.gov.uk/manuals/pommanual/paye20085.htm
    There are 10 types of people in the world - those who understand binary and those who do not. :doh:
  • xylophone
    xylophone Posts: 44,765 Forumite
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    I am wondering if FF is disabled, and has been employing a personal assistant to help with care / admin / whatever.
    FF is an employer, who has one employee on their books

    You could be right but "on their books..."? Would somebody employing a carer put it that way?
  • zygurat789
    zygurat789 Posts: 4,263 Forumite
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    I think you are being a tad hard here.
    Remember this is coming second hand from a new member who is here for help and, therefore, can't be expected to know the technical jargon.
    The question of being an employer but not having a business was really quite obvious and some people don't consider that the house in which they live is an asset in the way those more financially savvy would look at it, they would consider savings or shares as assets.
    However, certain good questions have been raised and it is really up to the OP to respond.
    The only thing that is constant is change.
  • xylophone
    xylophone Posts: 44,765 Forumite
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    The question of being an employer but not having a business was really quite obvious and some people don't consider that the house in which they live is an asset in the way those more financially savvy would look at it, they would consider savings or shares as assets.

    Not to me I fear! I obviously am dense....:eek:
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