ChatterBank4 mins ago
Debt relief orders
3 Answers
My friend has been advised to go for a Debt Relief Order as she now has a very low income. If her financial situation has not improved after 12 months these debts may be written off. However, she also owes over £1000 to the Inland Revenue due to over-payment of Tax Credits. Am I correct in thinking that this debt cannot be included as part of the debt relief as it is in effect owed to the Government ?
Thanks in advance for any advice.
Thanks in advance for any advice.
Answers
Best Answer
No best answer has yet been selected by Gazza61. Once a best answer has been selected, it will be shown here.
For more on marking an answer as the "Best Answer", please visit our FAQ.I was expecting my answer to your question to be "Yes, you're correct".
However the list of debts which can't be covered by a DRO, in the official guidance from the Insolvency Service, makes no reference to money owed to HMRC:
http://www.insolvency...fletspdf/droguide.pdf
Chris
However the list of debts which can't be covered by a DRO, in the official guidance from the Insolvency Service, makes no reference to money owed to HMRC:
http://www.insolvency...fletspdf/droguide.pdf
Chris
Any debt to HMRC (whether it is for tax credit overpayment or income tax or whatever) can be included in a DRO.
But for tax credits, it must be a debt which has "finalised". This means it has to relate to a tax year which has ended & for which the annual declaration has been done. HMRC then have to have issued a notification that the money has been overpaid and they require it to be paid back.
But for tax credits, it must be a debt which has "finalised". This means it has to relate to a tax year which has ended & for which the annual declaration has been done. HMRC then have to have issued a notification that the money has been overpaid and they require it to be paid back.