Updated: 5th February 2020
If your company is struggling with HMRC arrears, such as non-payment of VAT, corporation tax and/or PAYE, in chasing these debts HMRC may decide to use the services of a debt collection agency.
Although often known as HMRC debt collectors, these are actually third party companies that HMRC bring in to help rather than being employees of HMRC directly. According to Gov.uk, HMRC currently use 13 different debt collection firms to recover monies owed in unpaid taxes. The aim of HMRC debt collectors is to seize assets from the company premises which will then be sold off with the proceeds going towards paying down the debt.
The debt collection agencies HMRC uses are as follows:
Being faced with a letter threatening action from a HMRC enforcement officer shouldn't come as a surprise to any company director. It is the usually the result of a sustained period of time in which your company has failed to meet tax liabilities on time. It is common for HMRC to make numerous attempts to recover this debt themselves, either by calling you or by sending letters to notify you that the tax is overdue, but if it remains unpaid it is then likely that HMRC will outsource the debt collection to one of their trusted debt recovery agencies based around the UK.
Once HMRC has asked a debt recovery firm to chase the debt, it is often the case that you must make payment to the HMRC debt collection agency rather than to HMRC themselves, although you should always check this by speaking to HMRC directly before parting with any money.
At Real Business Rescue, we help company directors facing financial distress and most of the time, this distress includes tax debts owed to HMRC for unpaid VAT, PAYE or corporation tax. It is often the way that HMRC are last to be paid when directors are struggling balancing the books; it is easy for directors to shelve their tax payments and, instead, pay trade creditors first and foremost. It is only further down the line that directors then realise they do not have the means to meet their company tax liabilities when a HMRC debt collectors turns up at their door.
If you are struggling with HMRC tax or PAYE arrears, we offer a free initial consultation to all company directors in a Real Business Rescue office that is local to you. We specialise in helping directors with debts above £15,000 and can provide expert independent advice whether you're at the early stage of HMRC sending you an overdue tax letter or the more critical stage where HMRC enforcement officers are knocking on your door.
Contact us today on 0800 644 6080 for free advice from a licensed insolvency practitioner in your local area.