Tax and Debt: Magistrates’ Courts Proceedings

After a tax bill is late, the collector may decide to launch action against you in the magistrates’ court. The purpose will be to obtain an order for payment of the overdue tax.

Magistrates have the power to send people to jail. While this may happen, it is highly unlikely this will happen, unless you ignore a summons to appear in court.
Action cannot be taken in the Magistrates’ Courts for individual tax bills that are:

over £2,000, or
more than one year overdue.

Being informed of the hearing

You should receive a summons before the hearing that lists what tax is due and informs you as to the time, place, and date of the court hearing. You must receive this at least four days before the hearing.

What to do before the hearing

In the event that you manage to pay the tax and costs listed on the summons before the hearing, then no further action should be taken and the collector will inform the court that the action has come to a halt. If you think that a mistake has been made, and you do not in fact owe the amount on the summons, you should get in touch with the collector immediately and have them contact your tax office. If this needs more time to sort out, the collector may ask the court to adjourn the hearing. If it is eventually agreed that you do not in fact owe the tax, then the action should be halted.

The hearing

At the hearing, the collector will present debt certificates, which detail the amount of tax, interest, and penalties have been unpaid. The collector will then ask the magistrates to make an order for this amount plus costs.

While the magistrates will allow you to present your case, it will be nearly impossible to persuade them that you do not owe any taxes. The Revenue’s certificates are generally taken as sufficient evidence that the tax is due. You should thus be prepared for the magistrates to make an order for payment of the amount shown on the summons, as well as any costs that have been awarded to the collector.

What happens if you do not pay the amount ordered?

In the event that you do not pay the amount that has been ordered by the magistrates, the collector may enforce the order in one of several ways.

A private bailiff may be sent around to your house with a distress warrant that permits them to seize belongings that amount to the value of the debt for re-sale. Alternately, if the collector feels that distress warrant would not be successful, then a judgment summons might be issued. This requires you to attend court and explain why you have not paid. If the magistrates decide that you have been able to pay but have neglected to do so, then they may send you to prison.

Your credit record

An order of the magistrates will not have any affect on your credit record.

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