Can HMRC take money from your bank account?

HMRC can take the money you owe directly from your bank or building society account. This is called ‘direct recovery of debts’.

Why do I owe a debt to HMRC?

People owe debt to HMRC for a variety of reasons and the best payment solution differs from individual to individual. HMRC takes its responsibility seriously to make sure that people who can pay do so on time, whilst providing extra, bespoke support to people facing financial hardship or in personal difficulty.

Is there a time to pay arrangement with HMRC?

This guidance is for individuals and sets out HMRC’s approach to setting up a time to pay arrangement. People owe debt to HMRC for a variety of reasons and the best payment solution differs from individual to individual.

What happens when you pay overpaid tax to HMRC?

When a customer has overpaid tax (that would normally be repaid to the customer), HMRC can use that overpaid tax to reduce or clear other outstanding tax debts that they have. This will reduce the amount that customer owes to HMRC.

Can a customer appeal a debt to HMRC?

Customers have a right to appeal the debt with the creditor before the Summary Warrant is obtained. Creditors like HMRC, or those acting on a creditor’s behalf, can recover debts directly from customers’ bank and building society accounts.

How does HMRC deal with tax credit overpayments?

Section 29 Tax Credit Act 2002 has always contained a provision allowing HMRC to recover tax credit overpayments by adjusting the person’s tax code. The legislation states that in this respect tax credit overpayments are to be treated the same as underpayments of tax.

How does HMRC deal with direct recovery cases?

Direct recovery cases are dealt with by Debt Management (DM) which is a separate arm of HMRC to the tax credits processing side (who deal with ongoing recovery issues). DM collect tax debt as well as tax credit debt although the processes for each are different.

Can a HMRC charge order be used against a house?

HMRC have the power to use charging orders against a claimant’s residence where a debt is owed. Our understanding is that this will not be considered in stand-alone tax credit debt cases but may be considered if there is another HMRC tax debt as well.

How much money can you pay to HMRC per month?

As with shorter arrangements, payments of less than £10 per month will not normally be accepted and HMRC should suspend the debt in those cases and review after twelve months. HMRC may accept payments of less than £10 if the expectation is the amount can be increased at a later date.