Massive Whinge About HMRC
To those not familiar with HMRC, this story will be almost unbelievable .........
HMRC have set up a very efficient system of collecting VAT from traders by Direct Debit.
Each quarter the trader (or their accountant) enters the amount of VAT due on HMRC website and about
35 days after the quarter end HMRC’s bank take the VAT due out of the trader’s bank account.
Simple effective system - so far......
The important thing about a Direct Debit is that it is a pull transaction. It is driven by the receiving bank
(in this case the HMRC's bank). So, if a trader changes his bank account, HMRC must change their
instruction to their bank as to where to pull the money from.
Unbelievably, HMRC have no mechanism for doing this.
HMRC publish a Form 484 “Notifying us of changes to a VAT Registered Business”, section 2 of which
is called - wait for it - “Change of bank details”. So far so good. However at the bottom of
Section 2 are the words
".....These bank details are used by HMRC to make any repayments of VAT to your business. If you pay
your VAT by Direct Debit, we record those details separately. You will need to log in to HMRC
Online Services to keep those up to date."
So one goes to HMRC website where one finds the words:
Changing your Direct Debit - You can't change or cancel your Direct Debit payment using the
HMRC online service. If you do need to make any changes please contact your bank or building society.
And what does the trader’s bank manager say about changing HMRC’s Direct Debit.
Words to the effect of :
“Direct Debits are originated by the recipient’s bank. We are not able to change HMRC’s DD”.
My firm operate Direct Debit. If our customers change their bank account we are pleased to alter
their direct debit details.
Not so HMRC.
This national government organisation has set up a Direct Debit system with NO mechanism
for changing traders bank details.