HMRC not bankrupting me - but going for a CCJ

toomuch2

I was here a while ago getting some great advice, and here I am again.

I had managed to get an instalment programme with the HMRC which ran fine for several months. However I lost a freelance contract in about December last year. The business never never generated the cash I needed to pay back at the required amount (although it was growing). In April this year they stated they would bankrupt me. I took advice and started to get my ducks in a row. The first was to get a job as an employee, as I was going to lose my business under bankruptcy and the sector I work in will not freelance or contract to sole traders. I took that job at a much lower salary, but at least it would be a steady income.

I did ring them a few times to try and get an update but they just said to wait. Out of the blue about a month ago I got another letter that seemed to suggest I could still pay by installments, I rang them. They asked if I wanted to start the bankruptcy proceedings, I said if there was a chance of a repayment plan I would like to see if we could come to an arrangement, they said someone would get back to me.

Today I received a letter before claim for a CCJ - not bankruptcy. The annoying thing is that it took 5 days to reach me, severely eating in the 14 day response period.

I am confused and not quite sure what to do. Why having told me they were going to bankrupt me have they now gone is a different direction?

Is a CCJ a "better" option than bankruptcy, or should I now consider bankrupting myself?

Thirdly, the amount of the debt seems to have halved. Does this mean they are no longer going for the full amount, or if I get a CCJ will they then go for the rest?

Any thoughts gratefully received

enfield_freddy

how much was the debt , and how much are they taking you to court for?

toomuch2

The debt is around £35,000. The amount quoted in the letter is around £17,000.

enfield_freddy

fast track , multi track and limits perhaps (or rather costs)

National_Debtline

Hi toomuch2


It can be hard to guess at HMRC's thought process as their behaviour is not always that of the typical creditor. For example, they will on occasions bankrupt debtors as a purely punitive measure, even if they are effectively paying to write their own debt off in the process.


Here, they have indicated they may sue you for the money - though they are under no obligation to do this just because they have sent a "letter before action".


You will be no less able to bankrupt yourself after a CCJ than you are now.


Why they have abruptly dropped the amount they are seeking, I'm not sure. If you do go bankrupt, the whole debt will be included one way or the other.


Whether bankruptcy is the best choice for you is hard to say without much context. If you put up a Statement of Affairs then those on the forums can offer more specific advice on your best options.


Dennis
@natdebtline

WannaBLoaded

Maybe they are trying to put a charging order on your house?

toomuch2

Thank you for your replies

I am going to talk to one of the debt charities when I have a chance tomorrow, I want to do that before I talk to the revenue again. I do need some advice on what path to take. I won't put up an SOA right now, I have done one and been through it with both the HMRC and and one of the charities. I could pay them something each month, but that offer was rejected twice in the early summer.

I was just wondering why they chose a different course, and why the amount they want to sue me for is so much less than my debt.

Wannabeloaded - I have no assets (no car, no house, no shares etc etc), that is why they may take me to court for a CCJ, they may believe they would get more money than via bankruptcy.

Thanks again

antonic

If you have no assets then Bankruptcy is a waste of time for HMRC, as you have no assets to realise.

A CCJ means that they can affect your credit rating AND get the court to set a legally enforceable debt repayment plan, with the threat of bankruptcy if you fail the arrangement.

Also a CCJ costs a lot less to obtain than a Bankruptcy Petition.