HMRC - priority creditor?

[Deleted User]

I understand that there are two types of bills/debts. You have your priority bills/debts such as rent/mortgage and council tax, and then your non-priority debts such as credit cards. Which category does HMRC fall under? After a bit of Googling I think it is the former and would like someone to confirm this please. Thanks.

sourcrates

Err, most definatly priority, if its income tax related, tax credit overpayments, not so much a priorty, but income tax yes, you can go to prison in extreame cases.


What type of debt do you owe to HMRC ?

[Deleted User]

Allegedly income tax and national insurance. I dispute this and believe I owe HMRC diddly squat but they have other ideas. I know that others in a similar situation to me have had Accelerated Payment Notices issued and I have got my MP involved. HMRC are trying to get me to voluntarily settle providing I waive all my rights as a tax payer and have offered a time to pay arrangement with a large lump sum and monthly instalments greater than my monthly take home pay despite sending them a statement of affairs.

I have a number of credit cards with 0% deals and I had plans in place to repay them all before the 0% deals ended but it is fair to say that those plans have just gone down the toilet. C'est la vie.

sourcrates

Have you followed the correct complaints procedure with HMRC ?

Details here :

https://www.gov.uk/tax-appeals


What is the nature of the dispute, are you self employed, PAYE ?

[Deleted User]

sourcrates wrote: »

Have you followed the correct complaints procedure with HMRC ?

Details here :

https://www.gov.uk/tax-appeals


What is the nature of the dispute, are you self employed, PAYE ?

I was self employed. I have a tax adviser so I am not dealing with HMRC by myself. I just wanted to confirm that HMRC are a priority creditor so that I can get my ducks in a row so thank you for confirming that HMRC is a priority....not that they are currently a creditor.

iolanthe07

There's been a lot in the press recently about tax avoidance schemes using off shore accounts that were deemed legal at the time, but are now considered illegal. It does seem unfair to backdate demands from people who signed up to these schemes on the advice of their accountants believing them to be perfectly legitimate.

BoGoF

Lover_of_Lycra wrote: »

Is that relevant to my original question or do you have some pearls of wisdom for those who used either type of arrangement?

I did actually have some advice depending on what it was but since you seem to have a bit of an attitude I shall leave you to it.

[Deleted User]

iolanthe07 wrote: »

There's been a lot in the press recently about tax avoidance schemes using off shore accounts that were deemed legal at the time, but are now considered illegal. It does seem unfair to backdate demands from people who signed up to these schemes on the advice of their accountants believing them to be perfectly legitimate.

They're still not considered illegal but there is a new(ish) piece of legislation that is retrospective in its action which will make tax due.

[Deleted User]

BoGoF wrote: »

I did actually have some advice depending on what it was but since you seem to have a bit of an attitude I shall leave you to it.

I'm sure you did.

[Deleted User]

A bit of an update is that the government recently announced an independent review for the legislation that has landed me in a pickle with HMRC. As a result my settlement opportunity with HMRC is in limbo, not that I had agreed to settle on the terms offered because it was completely unaffordable.

Before the review was announced though I wrote to my 4 credit card providers (Bank of Scotland, Barclaycard, MBNA and Virgin) explaining the change in my financial situation and offering token payments of £1 a month until HMRC agreed more reasonable settlement terms. I sent off my income and expenditure to Barclaycard and Virgin and I'm about to do the same to Bank of Scotland and MBNA, my statement of affairs which includes HMRC's time to pay instalments clearly shows that my expenditure is greater than my income.

Virgin have written back saying that the amount I am able to pay is not enough for them to set up a formal payment arrangement but they have said that as I am experiencing financial difficulties they will not continue applying further interest and charges to my account. Then today I received a default notice from them which includes a £9 charge which is contradictory but fair enough.

Depending on the outcome of the independent review I might be ok to start paying the credit cards back in full or I might be facing bankruptcy which is an option I am seriously considering because I am positive my home is in negative equity at the moment and I am at the point of being able to VT my car.

What a bloody mess!

Thanks to those who took the time to reply to my thread.