Income tax priority - would other creditors get a CCJ?

[fievel]

Hi all,

 

I have a £30k income tax bill from a period that I was a partner in an LLP in 2010 to pay (since then PAYE employee/director in a limited company of which I own less than 5%).

 

I did an income/expenditure and figured out I could pay £2,000 after basic living expenses, which I was currently paying toward other creditor (~£40k owed, £1,200 a month bills, some on time, some defaults).

 

I offered this to HMRC and they said fine, no need to send us an income/expenditure (very nice chap on the phone)

 

I want to pay my tax bill ASAP for obvious reasons, but if I only make token payments to other creditors as a result, what are they chances of one getting a CCJ on me successfully? Renting currently, no assets except for my car that I need for my disabled son.

 

I work in the financial services industry and am an FSA approved person, so this would make my job a bit difficult. Obviously after I finish paying off the tax bill next September I can put the excess cash to my creditors and pay them off in two years.

[citizenB]

I believe that a tax bill/arrears takes priority. However, I will flag your thread for site team.

[Conniff]

If you continue to make payments, (albeit reduced payments), after explaining you have a tax bill to pay, (without going into too much detail), the chances of them getting a ccj are extremely remote and because you aren't trying to deny you owe them, it's very unlikely they will even attempt to get a CCJ.

 

CCJs are a means of getting a legal acknowlegment of a debt and agreeing an amount to clear that debt. You haven't made any noises trying to deny the debt and are already paying so will be assumed to have acknowledged the debt and will continue to make payments and not default.

Courts don't like being used in an attempt to increase monthly payments and creditors know this and know that it usually costs them in the attempt with no outcome. And you will probably be back to full payments with them before they could hope to get to court anyway.

[fievel]

I am paying about half of the debts but stopped paying the other half once the tax bill came through in January, since which I have also moved (get mail forwarded)

 

Reading through the threads on the forum, should I offer to pay them all a token amount straight away with some details of the tax bill, or should I try the CCA/penalty reclaim? From what I can see this would not work on loans or overdrafts, but may help with credit cards?

 

Also, in paying token amounts until next year, I assume that the remaining accounts will get defaulted and passed onto DCAs?

 

Thanks!

[citizenB]

Are there charges or PPI on the other debts that could be reclaimed ?

[fievel]

No PPI on any account, charges on the credit cards and overdrafts, not on the loans (I think).

[fievel]

Looking into full & final settlements next year as well as my parents have offered to help with a lump sum at the end of next year, so ideally would want to push these down as low as possible while avoiding CCJs (can't get the lump sum any sooner)

[Conniff]

If you admit to these debts then make a token payment to them all. If there is any doubt about the amount being claimed then get all the paperwork from them and check it out. This can also help to delay things if you are looking to get a little time on your side.

[fievel]

Thanks, and am I correct in that penalty charges can no longer be claimed on overdrafts, but only on credit cards? Shame as some of my overdrafts are all penalty charges!

 

The procedure for claiming unfair penalties is SAR & CCA and then the claim letter?

[citizenB]

Yes, only on credit cards and loans no longer able to reclaim on current account/overdrafts.

 

Although there have been some success where people have been able to claim hardship.

[fievel]

Ok, I will acknowledge overdraft and loan amounts where there are no penalty charges and offer them £1 each until the tax is paid off (should I tell them when that will be?)

 

For credit cards will do CCA/SAR to claim back all charges, then offer £1 each until tax paid off.

 

For both will hopefully be able to offer reduced full & final settlements next year (will offer them the amount I have borrowed, no interest or charges as I think that's morally fair).

 

Thanks!

[Conniff]

Are the disgusting charges they attache to someones non-fault problem moral! I wouldn't think down that road, they go for everything they can get and would put you out on the street if they thought they could get away with it.

 

When you make the offer, be diplomatic but tell them, (not ask), that is all you can afford at present and will review it in six months time.