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HMRC internal manual

Debt Management and Banking Manual

HM Revenue & Customs
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Ordinary Cause: Preparing partial discharges

Where a defender owns more than one heritable property and wishes to sell one of them, it may be appropriate to grant a partial discharge of the inhibition in respect of the specified property. The inhibition will remain effective in relation to the other properties.

Where you receive such a request from a defender to grant a partial discharge you must advise the defender that before this can be considered we must be satisfied that we will receive the whole of the available free proceeds of sale if this is less than the total tax outstanding.

If after taking the foregoing into account you are satisfied that a partial discharge can be granted you should tell the defender/defender’s agent that you will need to refer the matter to HMRC Solicitors Office who deal with all partial discharge requests. The defender should also be advised that a £20 fee will be payable by him for this service.

Referral to HMRC Solicitors Office

HMRC Solicitors office will be responsible for preparing or agreeing all partial discharges whether or not a defender’s solicitor has already prepared such a document.

That being so, on receipt of such a request for a partial discharge and, where satisfied that you will receive the whole of the available free proceeds of sale if this is less than the total sum outstanding, you must, as a matter of urgency, send the following by first class post to HMRC Solicitors Office:

  • the full name(s) of the person(s) inhibited and for whom the partial discharge is required
  • a copy of the certificate of execution of service signed by the messenger-at-arms
  • a copy of the application for warrant to inhibit showing both the date on which the warrant to inhibit was granted by the court and the stamp of the Keeper of the Register of Inhibitions and Adjudications showing the date on which the inhibition was registered
  • the name of the person who will be signing the discharge. (This as far as possible should be the debt manager who signed the initial writ)
  • a copy of the disposition or conveyance containing the description of the specific property for which the partial discharge is required. (You should be able to obtain a copy of this from the defender or his agent.)

You must also attach a full report outlining the circumstances of the case.

Include any other relevant material with your papers and advise whether the inhibition is in execution following on decree or exceptionally on the dependence of the action.

HMRC Solicitors Office will then prepare the document and return it to you for signature. On receipt, the document should then be signed before a witness. Both the signature of the Pursuer (the debt manager taking the proceedings) and the signature of the Witness should be entered at the foot of the form and a copy of the document should be retained with the case papers.

You should then arrange a meeting with the defender/defender’s agent so that you can hand over this document as long as the defender/defender’s agent can, in exchange, provide you with a banker’s draft or other form of guaranteed payment. If a personal cheque is tendered then you must inform the defender/defender’s agent that you cannot let him have the discharge until the cheque is cleared by the bank. (In such a circumstance you will need to await the cheque clearance and then make arrangements for the discharge to be released to the defender/defender’s agent.)