HMRC Arrears & Claims

HMRC debt collection

HMRC debt and claims to pay it can rapidly put your business in a difficult position. HM Revenue & Customs take debt collection seriously, and if your business is struggling to pay the taxes owed, you must act swiftly to deal with the issue.

Whether you are having difficulties with paying VAT, PAYE, Corporation Tax or any other taxes levied against businesses, it is vital that you engage with HMRC and do not ignore letters from the taxman.

If you do not feel able to talk to HMRC, then you must engage a professional to deal with them on your behalf. Although it can be tempting to avoid dealing with the issues, you are much more likely to reach a good resolution for your business if you act sooner rather than later.

If you have HMRC debt, act now to avoid a winding-up petition

When you have built up arrears with HMRC, this is usually as a result of cashflow problems. However, even if you do not believe you can pay the full amount of arrears owed, you must remain involved in the process and respond to any demands issued in order to avoid the possibility of a winding-up petition.

HMRC debt recovery – what you need to know

It is important to understand the three main areas of concern that HMRC have when dealing with businesses that can’t pay their tax:

  1. Knowing how much is owed
  2. Paying the HMRC Debt
  3. Ensuring the problem doesn’t happen again

Whatever stage you are at with HMRC, you must act today and talk to a business recovery specialst. The sooner you deal with your business challenges, the more likely it is that we will be able to put a business recovery plan in place.

HMRC debts can escalate quickly, but even if you feel like you have reached the end of the road and all hope is gone, please pick up the phone or send us an email. As business recovery professionals, we may be able to suggest a solution you were unaware of.

How we can help with HMRC Debt

We provide business owners with options, guidance and solutions, no matter what the situation. For more information, or a no-obligation conversation about your situation, contact us today, call us on 0333 222 8065 or email

Knowing how much HMRC Debt is owed!

  • HMRC do not know how much you owe them unless you tell them! This means that you must file VAT returns, submit monthly PAYE returns, and deal with all other necessary tax declarations within the prescribed time limits.
  • HMRC are first alerted to potential problems when a business is consistently late in filing its returns. For example, businesses that can’t pay VAT, perhaps due to cash flow problems, will often avoid submitting returns.
  • However, if you do not tell HMRC how much you owe then they have the power to assess your business for various categories of tax and then collect based on those assessments.
  • Failure to submit returns is not always down to cash flow problems. A failure to submit the various tax returns is quite often the result of inadequate internal resources, particularly where all the administration and paperwork is dealt with by the owners of a business.
  • If you need administrative assistance, we work with a number of cost-effective accountants and bookkeepers that can help to get your books in order and submit returns to HMRC. This will enable you to clear your HMRC debt and get your business finances back on track. If this is something we can help you with, please contact us. Call us on 0333 222 8065 or email

Paying the Tax owed

  • HMRC debt recovery

If your business is late in paying tax, or is unable to pay, either in full or at all, then you will come to the attention of HMRC quite quickly. It is important to remember that HMRC wants to collect tax and does not want to see a business fail, so there are steps we can help you take to deal with arrears.

  • HMRC time to pay

One of the first options to look at is the “Time to Pay” arrangements that can often be put in place with HMRC. Contacting the tax office yourself can be daunting, especially if you are not used to negotiating with HMRC, so we can help you to put your case to HMRC.

We will assist you in producing robust trading forecasts to ensure that the repayment terms are realistic. The tax office will also want to see that you can meet your ongoing tax obligations while paying off your HMRC arrears.

  • What if you can’t pay your VAT, Corporation Tax or PAYE?

If the tax due cannot be repaid, then HMRC will use their far-reaching debt collection powers. This can culminate in an enforcement officer visiting the trading premises to seize business assets, or ultimately HMRC can issue a winding up order. This may eventually lead to HMRC closing down a limited company.

  • Winding up petitions – what happens next?

A winding up petition has far reaching consequences for a business, including an advertisement in the London Gazette. Eventually, all business bank accounts are frozen whilst the petition is heard by the court, and restrictions are placed on dealing with the assets of a company.

If any of your other business creditors become aware of a winding up petition they can “join in” or support the petition by adding their own debt. This can make the situation more difficult to resolve.

If you have already received a letter threatening legal action, a statutory demand, a winding up petition or a winding up order, please act now to protect your business.  Contact us today on 0333 222 8065 or email

Ensuring the Problem doesn’t happen again

  • Preventing further HMRC debt and claims

Once you have reached an agreement with HMRC they will want to know that you, the business owner or owners, will not let the same thing happen again. While you are paying your HMRC debt, they will want to see that all ongoing tax returns are submitted on time and that tax is paid when due.

If the cashflow problems faced by a business are too great, then business recovery may not be possible and an insolvency solution could be the only option. Business failure means that HMRC will watch any future businesses operated by the owners and carefully monitor tax compliance. On some occasions this might include demanding a financial bond before tax reference numbers are issued to a new business.

If possible, we’d like to talk to you before you are at the stage of seeking liquidation advice. Please do not put off talking to the business recovery professionals.

  • There are a number of ways we can help with our business support services. Click below for more details on:

Protection for Directors

Finance options

  • Act Now!

Whatever the stage your business may be at with HMRC debt problems, don’t do nothing! The problem will escalate and the longer it goes on, the more difficult and limited the solutions become. Please contact us on 0333 222 8065 or email for an initial discussion.