Does HMRC Debt Affect Credit Rating?

Editorial Note: These blog posts represent the opinion of DoNotPay’s Writers, but each person’s situation and circumstances vary greatly. As a result, you should make sure to do your own independent research. Because everyone is unique, our self-help tools are never guaranteed to help with any specific situation. DoNotPay is not a law firm and is not licensed to practice law. DoNotPay provides a platform for legal information and self-help.

Does HMRC Debt Affect My Credit Rating?

Having may be highly concerning since it's related to the government and, by now, you may be worried about . It's an understandable concern and, since it's related to the government, the answer isn't an easy one. With DoNotPay, it can be made easier.

DoNotPay can help you navigate the unknown waters of resolving HMRC debt and repairing your credit rating. Our process is much less frustrating than dealing with the government, easier, faster, and more successful. Keep reading to find out more about how DoNotPay can help you with your HMRC debt.

I Have HMRC Debt. What Happens if I Don’t Pay It?

If you don't talk to HMRC to arrange to pay your debt, you'll face penalties in the form of 5% of the original amount owed. Penalties are levied at:

30 days past due5%
6 months past due10%
12 months past due15%

This can add up to a substantial amount. So it’s time to act. You'll need to contact HRMC to verify the debt, dispute the debt, or pay the debt/set up a payment plan within the first 30 days of being notified to help prevent the likelihood of accruing penalties. If you decide to do nothing, you are more likely to be taken to court or have more penalties levied, such as wage garnishment. None of these options are appealing to most people, which means that it can be in your best interest to handle your HMRC debt using DoNotPay.

Are There Any Other Options for Dealing With HRMC Debt?

If there is a legitimate reason, you can complain to the FCA. You would submit a complaint if:

  1. The company handling your HRMC debt is not following the rules
  2. You don't owe the debt
  3. The amount of the debt is wrong
  4. You are being harassed
  5. Your debt isn't enforceable
  6. You are in financial difficulty

If you contact the FCA, you should expect to have a response in 10 days. You can also work within an ADR scheme to resolve the differences. This allows a neutral party to listen to both sides and develop a satisfactory solution that is fair to both sides. This will take longer but may be well worth the wait.

How Long Can HMRC Collect a Debt From Me?

The Limitations Act of 1980 indicates that the debt can only be pursued for 6 years if you have not made a payment or acknowledged the debt. However, most investigations by HRMC are within 4 years. On the other hand, some debt chased is as old as 20 years old. Therefore, you'll want to address HMRC debt problems as soon as possible in order to prevent further penalties and consequences, such as wage garnishment.

I Don’t Want to Deal With This. Can DoNotpay Help Me?

Absolutely! It doesn't matter if HRMC just recently contacted you or if you've been contacted repeatedly over the months. DoNotPay can help you determine what your next steps should be. We'll ask you some questions to help you make this decision and even make contact on your behalf. Here's what you need to do:

  1. Search "debt collection" on DoNotPay.

  2. Answer a series of questions about the debt collectors, including when you were contacted and how you were contacted, so we can determine if they have violated any debt collection laws.

  3. Decide which course of action you want to take based on our guidance, such as filing a debt verification request, demanding for the collectors to stop contacting you, or reporting them to a professional trade association.

The solutions offered by DoNotPay are fast, easy, and successful. That is, the outcome is geared to be the most positive for your individual circumstances. We will send demand letters through first-class mail and file complaints if that's the option you choose. There's no reason to stress. Take the steps above and DoNotPay do the rest on your behalf.

Brilliant! Is There Anything Else That DoNotPay Can Help Me With?

A resounding "yes!" DoNotPay can help you take care of many different things, from debt collection problems to finding lost money, we've got you covered.

First, use the app to work on cleaning up your credit. It works for all UK debt collectors. Some popular ones include:

Then, use the app to find other ways to save money or time.

As you can see, DoNotPay can help you take care of many different problems. This list isn't comprehensive and there are many more things on our website that we can help you with. Want to make life a little easier? Let DoNotPay help you today!

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