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HMRC internal manual

Debt Management and Banking Manual

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HM Revenue & Customs
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Enforcement action: distraint: preparing for distraint calls: the distraint notice C204

 

Choice of type of C204

Form C204 (both the IDMS and the clerical version) comprises a distraint notice, an inventory and a walking possession agreement.

The IDMS C204 is for IDMS work items only and the clerical C204 for non-IDMS debts, for example Stamp Duty Land Tax, and where you have both IDMS and non-IDMS debts in the same action. An IDMS C204 for VAT debts is available with limited functionality.

The decision on whether to print an IDMS C204 or use a clerical one is left to management discretion.

IDMS C204

The IDMS C204 is a computer-completed form available to C/W DISTRAINT. It does not require any clerical completion as it

  • summarises the debts you include on the form
  • includes interest to the date that you select and the daily accrual rate
  • calculates the distraint costs
  • prints the taxpayer’s name and address and your office address.

The advantage of printing the C204 from IDMS is that it generates an accurate distraint notice, detailing the correct debt, costs and interest to date along with providing essential action history notes and Designatory Details. A disadvantage is that a large amount of paper is generated which may not be required: because of IT constraints, the form consists of two sheets of A4 and IDMS automatically prints two sheets of each.

The IDMS C204 shows a total debt amount inclusive of interest, supported by the IDMS Statement of Liabilities form. The Statement of Liabilities is a legal part of the Distraint Notice and Inventory.

Possession fees

The IDMS generated C204 prints possession fees as 0.45p per day and an accruing amount. This is incorrect for indirect tax debts therefore you should delete these entries and enter the correct amount of £7.00 after the WP has been signed.

Statement of liabilities

You do not have to separately request a Statement of Liabilities. Two copies are automatically produced whenever you request an IDMS C204.

Taxpayer address and debt details

Address

The taxpayer’s name and address, which is printed on the form, is the recovery name and address shown on the TAXPAYER INFORMATION SCREEN. If no recovery name and address are present then the taxpayer name and address is printed on the form. To ensure that the taxpayer’s correct name and correct place of levy are shown on the form check and where appropriate amend DESIGNATORY DETAILS before requesting the form.

Debt details

To include the correct debt details on the form link all the work items that you wish to include in the distraint.

Date

When you request the form you will be asked to enter a notional date. As the notional date will be the date interest is calculated to on the Statement of Liabilities and the date printed on the IDMS C204 the date entered should be the proposed date of your distraint visit.

If you change the day of your distraint visit you can either

  • use IDMS to obtain a new form using the revised notional date or
  • amend the date on the IDMS C204 to the revised date of visit
  • amend the interest figure on both copies of the Statement of Liabilities
  • amend the debt total on both copies of the IDMS C204 by the amount of interest.

Printing the form IDMS C204

To obtain the IDMS C204

  • highlight a single work item or the master work item of a linked set on the TAXPAYER INFORMATION SCREEN
  • select menu item Forms then option .

Along with the Distraint Notice and the Statement of Liabilities a copy of the IDMS Call Sheet will also be printed.

Note: As at least ten sheets are prepared for each form requested, please remember to allow sufficient time to print all the forms you need.

Call sheet

Along with the Distraint Notice and the Statement of Liabilities a copy of the IDMS Call Sheet will also be printed.

Clerical C204

Use of the clerical version of form C204 is optional or available for use when you are pursuing a debt that is not on IDMS, for a combination of IDMS and non-IDMS debts and for when you prefer not to generate the papers associated with the IDMS version.

Although the distraint notice section may be prepared at the time of the distraint call, in order to avoid delay at the defaulter’s premises, it may help to prepare as much of it as is possible before your call. If not, distraint officers will have to prepare manual forms when they levy distraint, on customer’s premises and should make sure they take all relevant information with them.

Take due care to ensure the accuracy of the completion of manual C204s as incorrectly completed forms or omissions may result in the levy being compromised. For a PAYE/NIC debt amend C204’s prepared clerically to show only a single combined amount.

The inventory and walking possession sections should be completed and signed when you have seized the defaulter’s goods.

Completion of C204

Completion of the Distraint Notice is self-explanatory but you should complete the section titled ‘Details of the debt’ in sufficient detail to identify the particular charge for which you are levying distraint. Form C204E provides a useful summary to assist if necessary.

IDMS debts

If you are including direct tax IDMS debts on the clerical C204 continue to list the debt details individually. If indirect tax debts on IDMS show a composite amount covering more than one period enter that total amount shown. To avoid any dispute, do not amend the wording or include any cross-reference to a Statement of Liabilities.

Welsh language

If you have made previous applications for payment in Welsh, use the Welsh version of the form (C204(W)).

Welsh Language versions of these forms are available (This content has been withheld because of exemptions in the Freedom of Information Act 2000)  

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

Direct and indirect taxes

Direct and indirect taxes should not be included in the same distraint and accordingly should not be entered on the same C204.

Interest

For interest-bearing amounts where the interest is still running, attach an interest computation to form C204 only if the defaulter queries the interest.

If you are levying distraint for an interest charge raised after the debt was paid, you will still need to prepare a computation. An SA statement will only show a due amount without providing an accurate breakdown of the interest. The defaulter will have already received a computation. Similarly PAYE interest will only provide a demand without giving a computation.