Her Majesty’s Revenue and Customs is becoming increasingly harsh with people who owe them money. The government body has always organised debt collectors to seize the possessions of those who have not paid their taxes in full, but in the last three years, they have spent five times as much on debt collector services. The figure has risen from only £6.2m in 2014 to a whopping £39.1m in 2017.
This tactic of the HMRC isn’t new, but their increased reliance on it seems to be working. The government stated that unpaid tax was at a “record low” as the tax gap fell to just 6% from 2015 to 2016 due to the government cracking down on “avoidance, evasion and non-compliance.”
It is worth noting that for the majority of the population your income tax is sorted automatically before you are actually paid. However, for those of you who own your own business or are self-employed, you may be in danger of owing money to the government due to misunderstanding tax regulations.
Is This Tactic Legitimate?
This technique by the HMRC has met some criticism despite its results. This is because the government has little control over how these debt collectors conduct themselves. Many people have complained that these companies are overly aggressive and forceful in comparison to traditional methods used by HMRC itself.
However, an HMRC spokesperson claimed otherwise. He described their relationship with these debt collection agencies as “effective and efficient” and that the agencies they worked with were expected to follow the strictest of codes and guidelines.
He added that if anyone has a problem or discrepancy with the amount that he or she owes to HMRC, he or she should reach out as soon as possible. He also stated that it is possible to request for extra time to pay and that each of these requests will be “considered individually” according to your specific circumstances.
Whatever the case, it would appear that if you are a business owner or self-employed, you should be extra vigilant that you are following the tax code correctly. If you cannot pay, it is crucial that you reach out for help as soon as possible. debt free life has the experience and knowledge to help even those in the most desperate of situations and can negotiate with HMRC on your behalf.
Why Owing Money to the Government Is a Priority Debt
Letting any debt get out of your control is a problem. When you start to miss payments, you might be hit with further charges that can make the balance even more challenging to settle leading to further problems and difficulties. However, there is a difference between owing money to the government and owing money to a private company.
When you owe money to a non-governmental company their powers to get their money are more limited. What this means is that their actions can be more unpredictable but less severe. Things can get very bad, make no mistake about that, but it is a more drawn out and complicated process.
Owing money to the government, on the other hand, is much more severe. They have powers that private companies do not which can make life very difficult for you. If you owe council tax, for example, the local authorities can take away your ability to pay what you owe in instalments. Next, come significant fines. Lastly, in extreme cases, you could face criminal charges and jail time.
If you owe money to the HMRC, they can very quickly send bailiffs or sheriff officers to seize your possessions. They can also take money directly from your account which can make it difficult to keep track of your money and keep up with your other financial commitments. Again, if things go far enough, you will face criminal charges and jail time.
Get Help Now
If you owe money to the government, or any company for that matter, it is vital that you take steps to turn your situation around. No matter what your exact path is back to financial stability, the first step is always to seek professional help. Our team of friendly advisers takes thousands of calls every week and are committed to doing everything we can to helping those who reach out to us for help.
Whether you need some clearly-explained and non-judgemental help or would like some assistance in setting up a debt solution, we are only a phone call away at all times. If you cannot talk right now, either fill in our debt calculator or send us an e-mail and we will be back in touch as soon as we possibly can.