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HMRC internal manual

Debt Management and Banking Manual

Enforcement action: distraint: costs and accounting: possession fees

Walking possession fees

Where you allow walking possession (WP)

Direct taxes

  • enter £0.45 in the “Possession costs (one day)” box of form C204 covering the day of the levy
  • charge the defaulter this amount and £0.45 for each succeeding day, up to a maximum of 15 days (£6.75) including the day distraint was levied.

Indirect taxes

  • leave blank the “Possession costs (one day)” box on the C204 (there is no provision for daily possession costs)
  • enter £7.00 in the “Plus Walking possession” box after the agreement has been signed
  • charge this to the defaulter.

Direct and indirect taxes

In all cases, where the distraint visit was accompanied

  • pay the possession fees to the bailiff.

Where the bailiff is a `taxable person’ (DMBM656340)

  • for direct taxes, add

    • £0.08 VAT (where only day’s possession fee is paid) or
    • £0.07875 VAT per day (where more than one day’s possession fee is paid) :round the total down to the nearest penny, subject to a maximum of 15 days
  • for indirect taxes, add £1.22 VAT.

Do not recover the VAT from the defaulter.

Immediate removal or close possession

If you decide to remove the goods immediately or need to take them into close possession

  • charge £4.50 for the day of the levy only
  • pay this amount to the bailiff
  • add £0.79 VAT where he is a `taxable person’
  • do not recover the VAT from the defaulter or pay additional days’ possession fees.