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HMRC internal manual

Debt Management and Banking Manual

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HM Revenue & Customs
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Debt and return pursuit: foreign cases: Mutual Assistance in the Recovery of Debt (MARD) (EU States): about requests for recovery

A request for recovery can be made if the debtor owes a tax or duty debt covered by the agreement and either:

  • lives in, or is established in, another member state
  • has assets in another member state.

A request for recovery should be made using the standard e-form and must be accompanied by a Uniform Instrument Permitting Enforcement covering the debt.

A requested member state will recover a debt referred to them under these arrangements using the same recovery procedures they would use to recover an equivalent debt within their own state.

Uniform Instrument Permitting Enforcement (UIPE)

The Uniform Instrument Permitting Enforcement (UIPE) is produced by the applicant member state and must reflect the substantial contents of the initial Instrument Permitting Enforcement(s). The UIPE may cover more than one tax type and doesn’t require a signature. The UIPE must be used as the sole basis for taking recovery action in the requested member state.

The notification of the UIPE to the debtor doesn’t prolong or reopen the time limits for contesting the original debt, if that debt has been validly notified.

The original Instrument Permitting Enforcement doesn’t have to accompany a request. If it is attached, it does not need to be translated into the language of the requested member state.

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Recovery action in the applicant member state not exhausted

An applicant member state can make a recovery request even if all the domestic means of recovery in that state haven’t been exhausted. However, they may only do so if either:

  • it is obvious that there are no assets for recovery in the applicant member state and information indicates that the debtor has assets in the requested member state
  • to exhaust all domestic means of recovery would give raise to disproportionate difficulty.

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Grounds for refusing a request for recovery

A requested member state can refuse a request for recovery if the:

  • request is out of time (see DMBM560040 for more information about time limits)
  • recovery of the claim would, because of the situation of the debtor, create serious economic or social difficulties for the requested state; the only exception to this is where, had it been a claim of that state, legislation requires recovery
  • total amount of debt to be recovered is less than €1,500 (including interest and costs).

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Exchange rate

The exchange rate to be used for all recovery requests is the last exchange rate published in the Official Journal of the European Union before the date the request is sent. The exchange rates can be found under the C series.

The exchange rates are also available via the European Central Bank currency convertor application.

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Recovery fees and costs incurred in the requested member state

The requested member state will not charge the applicant member state for taking recovery action. However, where the requested member state has both:

  • incurred recovery costs such as court costs
  • recovered an amount from the debtor, but was unable to recover its own costs completely

it will be able to deduct these costs from any payments it has recovered and only remit the remaining amount to the applicant member state.

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UK interest

Where we’ve been asked to recover a debt on behalf of another member state, we may charge UK late payment interest on that debt.  However, we will only do so if we would charge late payment interest on an equivalent UK debt. Any payment recovered in respect of this interest is forwarded to the other member state.

Where UK interest is charged, it is charged from the date of receipt of the request until the date the debt is paid.

This interest is in addition to any interest the other member state may have already charged on the debt before they sent the request to us.

Identifying foreign MARD debts on IDMS

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