there has been quite a bit reported recently about HMRC being able to code out debts of up to £2999. I understand that this is a new scheme and totally seperate to the 'coding out of SA debts if the Return is filed by 31 December.'
Is the new scheme only available if invited to by HMRC? I have a client who has missed the 31 December deadline for coding out his 10/11 liability so i wondered if he could make use of this new scheme. Seems strange that you have to leave a debt unpaid for months and wait for HMRC to tell you they are coding it out. Surely the taxpayer can request it?
i have spoken to HMRC twice today. The first girl said it wasnt available for SA debts, only for debts like overpaid tax credits. That is absolute tosh, as the guidance specifically mentions SA debts. I rang again and was told that it was done on a selected basis, and was for HMRC to decide who they write to.
just wondered if anyone had had a client who had used the facility.
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Coding out small debts
It certainly is available for SA cases providing the Return was filed by 30 December and there is sufficient liability to collect it. It cannot more than double the estimated liability for 2012/13 and, if it does, my understanding is that none of it can be coded.
Unsure about non SA cases but I assume the same would apply.