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HMRC internal manual

Debt Management and Banking Manual

DMBM560245 - Debt and return pursuit: foreign cases: Mutual Assistance in the Recovery of Debt (MARD) (OECD and DTA): Requests for Recovery received from other countries: International Debt Unit, MARD Team action

Initial Action

Review the case to check for suitability (This content has been withheld because of exemptions in the Freedom of Information Act 2000) .

Check :

  • which agreement the request is made under
  • that the conditions for making the request apply.

Request does not contain all required information

Unless the MOU says otherwise, there are no agreed timescales for reply. Those set out here are based on best practice, and we cannot insist on the applicant country adhering to them.

If the request doesn’t contain all the information you need in order to action it

  • write to the applicant country within 14 calendar days of receipt of the request to:
  • acknowledge its receipt
  • ask the applicant country to provide the missing information within one month.  Explain that we cannot progress the case without this missing information,
  • set up a new case (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

If you haven’t received the missing information when the BF expires, reject the request.

On receipt of the additional information, accept the request.

Request rejected

If the request is not accepted, write to the applicant country within 14 calendar days of receipt of the request to explain why you cannot deal with the request. Record any rejected cases. Close your case.

Request accepted

If the request is accepted, and if not already done so:

  • write to the applicant country to acknowledge the receipt of the request within 7 calendar days of the receipt
  • set up a new case (This content has been withheld because of exemptions in the Freedom of Information Act 2000) , and
  • check HMRC systems to confirm the debtor is at the address mentioned in the request.

Debtor’s address confirmed

  • send a completed MARD2B SEES letter and a copy of the  Instrument Permitting Enforcement  (including a translation if not received in English) to the debtor, and
  • B/F for 1 month to await payment.

Debtor’s address different to that provided by applicant country

If you confirm a UK address for the debtor, but this differs from the address shown on the request for recovery:

  • if the address provided by the applicant country is in the address history,  send a completed MARD2B SEES letter and a copy of the Instrument Permitting Enforcement to the debtor at the latest address held by HMRC; tell the applicant country of the new address when you acknowledge the case
  • if the address provided by the applicant country is not in the address history but is a valid UK address, send the MARD2B SEES letter and a copy of the Instrument Permitting Enforcement to the debtor at both addresses.

B/F for 1 month to await payment.

Debtor not found

If there is no record of the debtor on our systems, but the address provided by the applicant country is a valid UK address, send a completed MARD2B SEES letter and a copy of the Instrument Permitting Enforcement to the debtor at the address provided by the applicant country.

Debtor has no UK assets

If your information indicates that the debtor has no UK assets that could be used to satisfy the debt

write to the applicant country to explain why the debt could not be recovered

  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
  • close your case.

Debtor not resident

If the debtor is not resident in the UK, but you have information to indicate that they have UK assets that could be used to satisfy the debt, deal with the case in accordance with DMBM560305

Debtor due a UK tax or duty refund

If you have information to indicate that the debtor is due a refund from HMRC, consider whether the refund can be set off against the debt as per the normal guidance within DMBM700000.  You cannot set off the refund against the debt if HMRC don’t manage the equivalent tax or duty in the UK.

If the refund is set off against the debt, deal with as below Debtor pays the debt in full or Debtor makes a partial payment, as appropriate.

Debtor pays the debt in full

If the debtor pays the debt in full

  • update the (This content has been withheld because of exemptions in the Freedom of Information Act 2000) with details of the payment
  • arrange for the payment to be transferred to the applicant country
  • write to the applicant country to confirm the amount recovered once you have received confirmation from Finance that the payment has been successfully transferred to them, and
  • close the case.

Debtor requests time to pay

If the debtor requests time to pay, you can only agree it if the applicant country has delegated this authority to you.  When they send their request for recovery, they will advise whether time to pay is

  • acceptable without further consultation
  • only acceptable after consultation, or
  • not acceptable at all

Acceptable without further consultation

If the debtor requests time to pay, deal with as per the guidance in DMBM800000.

If the offer would not be acceptable if it were a UK debt, reject the request as per the normal guidelines.

If the offer would be acceptable if it were a UK debt:

  • update (This content has been withheld because of exemptions in the Freedom of Information Act 2000) with time to pay details
  • advise the debtor that the agreement is acceptable as per the normal rules
  • write to the applicant country with details of the agreed TTP, and
  • monitor the case to ensure the debtor doesn’t default. If the debtor defaults, follow the normal time to pay process for defaulted time to pay’s.

Only acceptable after consultation

If the debtor requests time to pay, deal with as per the guidance in DMBM800000.

If the offer would not be acceptable if it were a UK debt, reject the request as per the normal guidelines.

If the offer would be acceptable if it were a UK debt:

  • tell the debtor that you will need to consult the applicant country before you can tell them whether or not their proposal is acceptable.
  • write to the applicant country:
  • with details of the debtor’s offer
  • your recommendations for accepting the request,
  • if there are no other recovery options, tell them so; and
  • ask them to reply within 28 days.

 

If the proposal is acceptable:

  • update (This content has been withheld because of exemptions in the Freedom of Information Act 2000) with time to pay details
  • tell the debtor that the proposal is acceptable
  • monitor the case to ensure the debtor does not default.  If the debtor defaults, follow the normal TTP process for defaulted time to pays.

If the debt is already with enforcement, tell them to refer the case back to you to monitor.

If the applicant country rejects the offer, consider whether recovery is still possible. If not, write to them explaining that no further recovery action is possible.

Not acceptable at all

Advise the debtor that time to pay is not acceptable and ask for payment in full.  If the debtor fails to respond, consider the next appropriate enforcement action.

Debtor makes a partial payment

If the debtor pays part of the debt

write to the debtor requesting the remaining payment plus any additional interest due

update (This content has been withheld because of exemptions in the Freedom of Information Act 2000) with details of the payment

arrange for the payment to be transferred to the applicant country (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

write to the applicant country to confirm the amount recovered once you have received confirmation from Finance that the payment has been successfully transferred to them, and

B/F the file for further payment.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Debtor claims they can’t pay the debt

If you are satisfied that they can’t pay:

  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
  • write to the applicant country to advise why no further UK recovery action is possible, and
  • close the case.

If you are not satisfied that they can’t pay

  • advise the debtor that payment must be made immediately, and
  • if payment is not made, deal with as below – Debtor doesn’t respond or payment is not received.

Debtor doesn’t respond or payment is not received

If you are satisfied that the debtor is at the stated address, consider the next appropriate action to recover the debt.

Referring the debt for enforcement action

Before you refer the debt to the relevant office for the next enforcement action, issue the appropriate IDMS10 SEES enforcement warning letter and enforcement fact sheet to the debtor.

If the debtor fails to pay or respond to the warning letter, refer the debt to the relevant Enforcement Office for action using the agreed referral process.

If the referral is to Field Force, do not transfer ownership of the (This content has been withheld because of exemptions in the Freedom of Information Act 2000) record.  

If the referral is to another enforcement team, transfer ownership of the debt to them (This content has been withheld because of exemptions in the Freedom of Information Act 2000) .

Referring the debt for insolvency action in Northern Ireland

Before you refer the debt to the relevant office, issue the appropriate SEES IWL, a copy of your initial demand letter, the IPE and the relevant enforcement fact sheet to the debtor.

If the debtor fails to pay or respond to the warning letter, or if their response indicates that insolvency remains appropriate, refer the debt to EIS Edinburgh for action using the EIS referral process. Transfer ownership of the debt to them on IDMS but keep ownership of the SAFE record.

Debtor disputes the debt

If the debtor disputes their liability to or the accuracy of the debt, deal with their dispute as per the guidance in DMBM560295.

Further debt referred
  • Check that the request has been properly made; and
  • criteria for accepting the case

Check whether there is an IPE for this additional amount. If there is no IPE attached,

  • write to the applicant country on the day you identify that the IPE is missing asking for the IPE to be sent within 14 days of receipt
  • explain that without this, we cannot start recovery proceedings for this additional debt.

B/F for 1 month. If you receive no IPE after this time, continue your action for the original debt, and write to the applicant country informing them that we are rejecting the amount not covered by an IPE.

Reduction in the debt

Where the debt is reduced, continue your action for the reduced amount. In these circumstances, you do not need a new IPE.

Withdrawal of request

An applicant country may withdraw a request for assistance at any time in writing.  On receipt of such a notification

  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)