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Where Taxpayers and Advisers Meet

Tax Debt - Can IR force sale of marital home

stellad
Posts: 9
Joined: Wed Aug 06, 2008 3:32 pm

Postby stellad » Tue Jan 03, 2006 6:18 am

My partner is currently going through both an IR investigation and a divorce. The likely outcome of the tax investigation, due to business income he stupidly failed to declare, is that he will need to pay the IR a substantial sum of money. He won't be able to pay this debt and his only asset is his share of the equity in the former marital home, currently owned jointly by both spouses. In the divorce settlement it is likely that the house will be split 60-40 in favour of the ex-wife with my partner retaining a charge on the property until their child reaches 18 (10 years). Please can anyone advise if the IR can force the sale of the house in these circumstances, and if so is it common practice for them to do so? The irony is that the soon to be ex-wife is in fact getting the benefit of the unpaid tax because all the additional income was spent renovating the house! Such is life.

King_Maker
Posts: 6538
Joined: Wed Aug 06, 2008 3:22 pm

Postby King_Maker » Sun Jan 08, 2006 4:54 am

IMHO, Yes (in theory).

However, you might get a sympathetic judge to order a postponement of the sale until the child reaches 18 (or possibly, finishes full time education).

Was does your solicitor think?

stellad
Posts: 9
Joined: Wed Aug 06, 2008 3:32 pm

Postby stellad » Mon Jan 09, 2006 7:37 am

Thanks for your reply. The solicitor handling the divorce seems to think it's unlikely, but I don't think they've come across this scenario before. Presumably if the sale is postponed, the debt will continue to accrue interest.


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