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HMRC Debt Management Letter – Complete Guide

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By
Scott
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Scott Nelson

Managing Director

MoneyNerd’s founder, Scott Nelson, has a decade of financial industry experience, including 6 years in FCA regulated loan and credit card companies. Troubled by a lack of conscience in the industry, he founded MoneyNerd to give genuine advice to those in debt and struggling financially.

Learn more about Scott
&
Janine
Janine Marsh Profile Picture

Janine Marsh

Financial Expert

Janine Marsh is an award-winning presenter and a valuable member of the MoneyNerd team. With a wealth of experience as a financial expert, she's been featured on BBC Radio 4, BBC Local Radio, and BBC Five Live, and is a regular on Co-op Radio.

Learn more about Janine
· Jan 19th, 2024
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HMRC Debt Management Letter

For free & impartial money advice you can visit MoneyHelper. We work with The Debt Advice Service who provide information about your options. This isn’t a full fact-find, some debt solutions may not be suitable in all circumstances, ongoing fees might apply & your credit rating may be affected.

Are you unsure about a letter from HMRC Debt Management that’s landed in your post? Don’t worry, you’re not alone. In fact, over 170,000 people each month visit our site for information on debt matters just like this one.

In this article, we’ll cover:

  • Who HMRC Debt Management are and why they’re contacting you.
  • How to confirm if the debt is yours.
  • Steps to take next, including contacting them and gathering information.
  • Possible ways to manage or even write off your debt.
  • Keeping up with your debts and HMRC contact details.

Our team comprises experts who have also faced debt collectors and understand how worrying it can be. We’ve used our expertise to provide factual and clear advice to anyone who seeks it so you know what to expect and how to handle things.

Let’s delve into understanding the HMRC Debt Management letter and explore possible ways to deal with it.

Could you legally write off some debt?

There are several debt solutions in the UK, choosing the right one for you could write off some of your unaffordable debt, but the wrong one may be expensive and drawn out.

Answer below to get started.

How much debt do you have?

This isn’t a full fact find. MoneyNerd doesn’t give advice. We work with The Debt Advice Service who provide information about your options.

HMRC Debt Management Letter

Even if it is a letter from HMRC, you still may be confused as to who they are and what they want. Why are they getting in touch? And what is an HMRC debt management letter? First of all, we’ll have a look at HMRC.

Who are they?

HMRC, short for Her Majesty’s Revenue and Customs is a department of the UK Government responsible for the collection of taxes, the payments of some state support and the regulation of things like minimum wage and National Insurance. So pretty much anything official to do with money.

Why are they getting in touch?

There are a variety of different letters that HMRC could send to you, but we’re focussing on what happens if you receive an HMRC debt management letter. This particular letter will have been sent from the HMRC’s department of Debt Management and Banking. This is a service run by HMRC to help taxpayers with debts. 

Not only will they contact you if you are behind on your payments, but you can also contact them if you know that you can’t make one of your HMRC payments.

If you haven’t been keeping up to date with any payments that involve HMRC, then you will likely receive an HMRC debt management letter, asking you to settle your debt and pay them. Quite often, you’ll get an HMRC debt management letter if you haven’t been settling your PAYE or National Insurance payments.

How will they contact me?

When companies need to collect debt, they often use a variety of different methods of contacting you. They’ll send you letters, often quite strongly-worded, with regards to your unpaid debt, and after some time, they might end up making a decision to send out debt enforcement. 

The department of HMRC Debt Management and Banking will start things off by doing exactly that and sending you an HMRC debt management letter. This will lay out exactly who or what you owe the debt for, as well as the amount you need to pay, and relevant contact information.

If these initial HMRC debt management letters are ignored, they will escalate to something called a ‘Notice of Enforcement’ – as the title makes clear, this announces HMRC’s imminent intent to enforce recovery of their debts. They then may escalate it one step further if you continue to ignore them, and send bailiffs to your home.

How a debt solution could help

Some debt solutions can:

  1. Stop nasty calls from creditors
  2. Freeze interest and charges
  3. Reduce your monthly payments

A few debt solutions can even result in writing off some of your debt.

Here’s an example:


Situation

Monthly income £2,504
Monthly expenses £2,345
Total debt £32,049

Monthly debt repayments

Before £587
After £158

£429 reduction in monthly payments

If you want to learn what debt solutions are available to you, click the button below to get started.

Get Started

What to do next

So that’s some basic background information about your HMRC debt management letter. But what do you do next? Follow these steps to find out how to deal with them quickly and easily.

Contact them

One of the first things you should do if you realise that you can’t pay HMRC, or if you receive an HMRC debt management letter, is to get in touch with them yourself. 

A quick look at their ‘Contact HM Revenue & Customs’ section on their website shows an extensive list of different contact details. We’ll go through the ones that relate to your HMRC debt management letter.

If you want to call them, you can reach them on this number: 0300 200 3887. Their phone lines are open from 8am to 8pm, Monday to Friday, and 8am to 4pm on Saturdays. 

They don’t have a postal address available – however, the HMRC debt management letter they have sent might give you more options.

» TAKE ACTION NOW: Fill out the short debt form

Gather information

Make sure you are well prepared if you are going to contact HMRC debt management. Speaking with someone from HMRC debt management is the first step in negotiating an agreement. 

Whether they have sent you an HMRC debt management letter demanding payment, or you are contacting them about future payments, you should gather the following bits of information and have them to hand:

  • Your tax reference
  • Your name and address
  • Any reference on the letter (if you are responding to their correspondence)
  • Details about why you are struggling to pay 
  • How much you might be able to pay now

‘Time to Pay’ arrangement

If HMRC finds no signs of wrongdoing with your case, and you’ve responded to the HMRC debt management letter without too much delay, they may be open to negotiating a repayment scheme. Officially, they call this a ‘Time to Pay’ arrangement.

This is a structured payment plan to repay the money you owe over a period of 12 months or less in monthly instalments. If you end up missing one of these payments, your account will go into default, and they may outsource your debt to a private debt collection agency

Thousands have already tackled their debt

Every day our partners, The Debt Advice Service, help people find out whether they can lower their repayments and finally tackle or write off some of their debt.

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I’d recommend this firm to anyone struggling with debt – my mind has been put to rest, all is getting sorted.

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HMRC Contact Details

Email: [email protected]
Website: https://www.gov.uk/government/organisations/hm-revenue-customs

Final thoughts

So that’s our quick guide as to dealing with an HMRC debt management letter and what you might be able to do. It can be a stressful experience admitting that you may not be able to pay your taxes or settle your debts, but with some forward planning, you may be able to sort it out quickly and easily. 

If you are continuing to struggle with managing your finances, there are several charities and services that you can reach out to, who offer services to help you with things like an HMRC debt management letter. 

The following websites will have information that should be able to help you manage your finances and offer support with your debts:

Could you legally write off some debt?

Answer below to get started.

How much debt do you have?

This isn’t a full fact find, MoneyNerd doesn’t give advice. We work with The Debt Advice Service who provide information about your options.

The authors
Scott Nelson Profile Picture
Author
MoneyNerd’s founder, Scott Nelson, has a decade of financial industry experience, including 6 years in FCA regulated loan and credit card companies. Troubled by a lack of conscience in the industry, he founded MoneyNerd to give genuine advice to those in debt and struggling financially.
Janine Marsh Profile Picture
Debt Expert
Janine Marsh is an award-winning presenter and a valuable member of the MoneyNerd team. With a wealth of experience as a financial expert, she's been featured on BBC Radio 4, BBC Local Radio, and BBC Five Live, and is a regular on Co-op Radio.