Sole Traders

HMRC Enforcement Options

HMRC Distraint & County Court Judgments - What they mean for you!

Her Majesty's Revenue and Customs (HMRC) can take a number of enforcement methods to recover an unpaid tax debt. These include:

  • Distraint without a court order (bailiff action): HMRC does not require a court order to visit your business premises to take away your stock and equipment, up to the value of the debt. If there are not enough goods at your business premises, staff can go to your home and take goods from there (unless you trade as a limited company). If you refuse HMRC officials entry they could obtain a warrant to break in, but this is unlikely. They are more likely to take you to the county court or start bankruptcy proceedings
  • county court action: where HMRC will obtain a judgment against you giving their staff access to enforcement methods such as execution (bailiff action through the county court or High Court – see above), charging orders or attachment of earnings if you are employed
  • Use the magistrates' court: where the amount owed is less than £2,000. A summons to a hearing would be issued, which you should attend with your business and household budget to ask to pay by instalments. If you do not keep to these instalments a further hearing would be arranged to decide whether you should be sent to prison. For this you would need to be found guilty of 'wilful refusal' or 'culpable neglect' (see Imprisonment). The court may not decide to send you to prison but it cannot write off the debt;
  • Bankruptcy: if the tax debt is for £750 or more HMRC may start bankruptcy proceedings against you.

About Express Tax Solutions

Express Tax Solutions was founded with the intention of offering tax advice to those businesses facing problems with mounting tax arrears. Today, Express Tax Solutions has ten partners who practice an ethos of high-level involvement to ensure that each assignment capitalises upon the expertise and knowledge of the whole team.

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