We're aware that some users are experiencing technical issues which the team are working to resolve. See the Community Noticeboard for more info. Thank you for your patience.
📨 Have you signed up to the Forum's new Email Digest yet? Get a selection of trending threads sent straight to your inbox daily, weekly or monthly!

Given 3 months to pay 28k by HMRC

Options
2

Comments

  • fatbelly
    fatbelly Posts: 22,876 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Cashback Cashier
    la531983 said:
    la531983 said:
    Three months takes us until Feb, you want to sell it in the spring. Surely by the time the 3 months is up the house will almost be on the market anyway?
    "On the market" and "completed and funds received" are two different things though - it could easily be a further 6 months from it going on the market before the money is available to clear the debt.
    Indeed, they could put a charge on said property or do HMRC not roll that way?
    Yes they do, and that may be the only way forward here. See what Business Debtline say. Maybe also try

    https://taxaid.org.uk/
  • DigSunPap
    DigSunPap Posts: 375 Forumite
    100 Posts Name Dropper
    I have just began self-employed work and I need to declare my tax. Sorry to hear about your bill hopefully you can set up a payment plan with them. I am going to do a self-assessment next week.
  • In this case HMRC could take the line that the OP has actively avoided paying the outstanding tax as they were in a position to pay but purchased another house instead. If they do then I would be worried that they may petition for bankruptcy.  

    https://taxaid.org.uk/guides/taxpayers/tax-debt/bankruptcy#:~:text=HMRC%20can%20petition%20for%20bankruptcy,10%25%20are%20petitioned%20by%20HMRC.
  • TheAble
    TheAble Posts: 1,676 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    edited 9 November 2023 at 12:57PM
    DigSunPap said:
    I have just began self-employed work and I need to declare my tax. Sorry to hear about your bill hopefully you can set up a payment plan with them. I am going to do a self-assessment next week.
    While not wanting to hijack the OP's thread, I will chip in here with the strong recommendation that from day 1 of your self employment you ensure you ALWAYS take off from any income the amount that will be due to cover income tax, NI and VAT, if any. Also ensure that anything you need to budget for - for example - accountants fees etc is taken account of.  The money owed to HMRC should be put into a savings account paying interest at the best rate you can get while still being able to access the money when needed. It should then be considered as "not your money" for any purposes other than that for which is is earmarked. 
    Sound advice EH. Along with scrupulous record-keeping and filing in good time. Takes the stress out of it.
  • DigSunPap
    DigSunPap Posts: 375 Forumite
    100 Posts Name Dropper
    DigSunPap said:
    I have just began self-employed work and I need to declare my tax. Sorry to hear about your bill hopefully you can set up a payment plan with them. I am going to do a self-assessment next week.
    While not wanting to hijack the OP's thread, I will chip in here with the strong recommendation that from day 1 of your self employment you ensure you ALWAYS take off from any income the amount that will be due to cover income tax, NI and VAT, if any. Also ensure that anything you need to budget for - for example - accountants fees etc is taken account of.  The money owed to HMRC should be put into a savings account paying interest at the best rate you can get while still being able to access the money when needed. It should then be considered as "not your money" for any purposes other than that for which is is earmarked. 
    Thanks for the tip. Going to put 20% of each payment I have aside just to be safe.
  • Hoenir
    Hoenir Posts: 7,489 Forumite
    1,000 Posts First Anniversary Name Dropper


    A bit about my situation. I bought a house last year with some inheritance money, I am doing it up with the idea of selling in spring next year. 
    Rather than an idea make it an actual plan. Something you can offer the HMRC as a commitment to discharge the debt. As they've direct access to Land Registry records they know you've bought the property. 
  • Just a bit of a n update. I ended up calling HMRC and the person on the phone told me that some of the information given to me on this house call was incorrect. I CAN set up a payment plan as long as I make some sort of payment immediately. The 3 months threat was only if I didn't do anything at all, which is not what the person at the door told me. So I made a payment of 1k and set up a payment plan. The person on the phone was helpful and even asked what I could afford to pay monthly and set up a review in 6 months time. At least I am not panicking anymore, yes I still have to sort this out and I have an extra monthly payment that I need to cover on top of everything else. But I still intend to sell the house in spring and clear this debt completely. 

    Great advice about putting 20% of any income away. I need to make this a 'no exceptions' habit! 
    Exactly! Do it as soon as you get paid and just treat it as you would any other fixed outgoing.
  • Good news on the payment plan. I also echo ESSEX H.
     Every month I do a quick expenses of the month on paper (main categories such as office rent/bills/subscriptions plus any one-off items)  and subtract that from income and then put the tax aside. I put my tax money in my premium bonds as I am taxed on my interest but otherwise a high interest acct works.

    Note if you are SE once you are at the BR tax threshold you will be paying 20% tax + Class 4 NI of 9% so effectively 29% and at HR Class 4 is 2% so 42%
    There are loads of SE calculators online

    DON'T BUY STUFF (from Frugalwoods)
    No seriously, just don’t buy things. 99% of our success with our savings rate is attributed to the fact that we don’t buy things... You can and should take advantage of discounts.... But at the end of the day, the only way to truly save money is to not buy stuff.    Money doesn’t walk out of your wallet on its own accord.
    https://forums.moneysavingexpert.com/discussion/6289577/future-proofing-my-life-deposit-saving-then-mfw-journey-in-under-13-years#latest
Meet your Ambassadors

🚀 Getting Started

Hi new member!

Our Getting Started Guide will help you get the most out of the Forum

Categories

  • All Categories
  • 350.7K Banking & Borrowing
  • 253K Reduce Debt & Boost Income
  • 453.4K Spending & Discounts
  • 243.7K Work, Benefits & Business
  • 598.5K Mortgages, Homes & Bills
  • 176.8K Life & Family
  • 256.9K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 16.1K Discuss & Feedback
  • 37.6K Read-Only Boards

Is this how you want to be seen?

We see you are using a default avatar. It takes only a few seconds to pick a picture.