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HMRC internal manual

Debt Management and Banking Manual

Enforcement action: county court proceedings: administration orders: judgment debtor applies for an AO

A judgment debtor may apply for an AO where he or she cannot immediately pay the amount of a judgment and has debts (not necessarily entered in court) of less than £5,000.

You must never in any circumstances advise a judgment debtor to apply (or not to apply) for an AO.

Application for Administration Order

To apply for an AO, the judgment debtor must complete a request on form N92 [Application for an administration order] listing all his or her creditors and the amounts owing to each of them and details of his or her employment, income and liabilities.

Court action

On receipt of the completed form N92, the court may:

  • determine the rate of payment of all the debts “in full or to such an extent and within such a period as it appears practicable in the circumstances of the case” (CCR39 r5(6)) 
  • send form N373 [Notice of Application for an Administration Order] to each creditor and the judgment debtor setting out the proposed terms for the AO
  • enclose a copy of form N92.

Exceptionally, the court may fix a hearing date and will notify you on form N376 [Notice of Hearing - Administration Order (by direction of the court)].

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Action by debt technical office

Immediately on receipt of form N373 you must immediately:

  • make a thorough search of all records for any unpaid amounts
  • contact EIS where responsibility for the case has been transferred to that office
  • check that all unpaid due and payable amounts have been listed by the judgment debtor
  • prepare a file (if one is not already in use) headed ‘COUNTY COURT ADMINISTRATION ORDER’ in red ink
  • list all unpaid amounts in the file (including interest calculated to a date 16 days forward from the date of issue of the N373)
  • suspend all collection action for those amounts
  • decide whether the court’s proposed order is reasonable
  • complete the N373 and return it to the court either agreeing or objecting to the proposed order for payment.

Objection to a debt shown on application

A creditor may object to any debt listed by the judgment debtor by giving notice to the court, and the creditor concerned, stating the grounds for the objection. Where such an objection is made, the court will arrange a hearing. There is no need to attend but you should await the outcome of the hearing.

You must not object to any debt listed, in any circumstances.

If you receive a notice of objection to a HMRC debt, you should contact the EIS Bradford CCP Technical Team immediately.