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Scottish Trust Deed Forum
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Topic starter
19/06/2015 2:07 pm
Please help !!!!
I have previously been in and discharged from a trust deed and all went smoothly enough. I am an employee.
My partner entered his own trust deed in April 2014 and things are not going quite as expected. He is self employed and working in the CIS industry, whereby he pays tax at a rate of 20% from gross earnings. The workings of the CIS industry mean that each week he 'overpays' his tax liability and reclaims the total overpayment at the end of the tax year on his tax return. This is how his tax has worked for years.
His tax return for 2014-15, as expected, resulted in an overpayment of around £2,000 but HMRC are refusing to repay him this overpayment because his self assessment account has been marked as dormant due to a bankruptcy. Ive spoken to HMRC twice about this and tried to explain that a trust deed is not a bankruptcy but they were unable to understand. Im struggling to get through on phone again to HMRC (got through twice after trying almost every evening since 19th May).
Ive spoken to the trust deed administrator who advised that any tax overpayment should be repaid to my partner (due to the fact that his monthly contribution is calculated on his taxable income) and that we should speak to HMRC again. As already advised, getting through to HMRC is almost impossible, and when I do, they don't seem to understand about trust deeds.
Can you advise or direct me to someone who may be able to help ?
Thanks
Vicky
19/06/2015 3:38 pm
Hello Vicky
I feel your pain. HMRC have taken more than 30 minutes recently to respond to telephone calls - both employee and employer calls. Then to be told we have called the wrong number although we dialed the number we were told to.
Anyway, have you considered asking your Trustee if he/she would write a letter explaining the legal position to the Tax Office and sending that with a copy of the Trust Deed. That may give it official 'weight'. If not, perhaps he could guide you (or the others on here) what is the best wording to use.
If HMRC have the wrong record, they may be required to amend it under the Data Protection Act although perhaps it falls under the same legislation.
If your Trustee could write the letter that may give them the 'official' approach they require to change things. Just a thought. I guess the other Trustees on here may have dealt with similar before and can help.
19/06/2015 5:36 pm
Hi Vicky1980.
Firewalker's suggestion may well be helpful.
In addition, this may simply require some patience and persistence to cover everything directly with HMRC.
In many respects trust deeds and bankruptcies do work in similar ways so HMRC's policies and procedures might overlap.
Qualified Debt Adviser & Forum Administrator - Ask me anything about Trust Deeds 
22/06/2015 10:18 am
I think firewalker is right - ask your Trustee to get in touch with HMRC to point out that they are not entitled to preferential status and that those funds have already been taken into account as income when calculating what you are paying into the Trust Deed,
Scottish Debt Solutions Expert - Ask me for help setting up a Scottish Trust Deed or Debt Arrangement Scheme plan.
