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HMRC internal manual

Debt Management and Banking Manual

HM Revenue & Customs
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Debt and return pursuit: VAT: how debts are notified: notification of debt

Debt Management are notified of debts outstanding via VAT Local Action Notices (LANs) which are advised to IDMS either on the existing VAT Mainframe ADA run or on a daily basis depending on the reason. Guidance on VAT into IDMS: working in IDMS in DMBM950020 explains this further.

There are three enforcement runs per month; the main, mini and repayment enforcement runs.

VAT Debt Advices

Debt advices are the main way in which debts are advised to Debt Management.

Automatic Debt Advice (ADA)

New debts are referred by Banking to Debt Management by means of a VAT Local Action Notice to IDMS through the VAT Mainframe ADA run. This is an automatic process by which debts are advised to IDMS and show as specific work items depending on the category of the debt. The advised debts are then segmented into the campaign for automatic action.

Automatic letters are generated and issued appropriate to the campaign segment the debt has been referred to. IDMS will be noted on the date the campaign letter has been issued.

Manual work items

VAT work items should not be manually created on IDMS. Debts will be added to IDMS when the VAT debt is advised automatically. There are only two exceptions to this rule; when:

  • working cases advised on the IDMS Exception List; the necessary corrective action can continue as long as the guidance in DMBM950100 is strictly followed
  • the debt is with the Large Business Unit who deal with payment on account taxpayers or insolvent VAT groups, who should follow their appropriate guidance.