There are a few countries in the world where no income tax is payable, but in the majority of places, it is payable to your government based on what you earn. As long as you supply the correct information and pay the tax as and when it is due, the tax regime of wherever you are located will usually leave you alone. But if you fail to comply and owe them money, there are things they can do to make sure they get what is due.
What is a Tax Lien in the USA?
Your tax liabilities will be assessed in the USA and then you have just 35 days to either pay them or to come to some arrangement to clear the debt. One option the IRS has is to issue a tax lien. This could be a federal or state tax lien and basically gives them a legal right over your property or other assets.
The lien remains in place until the debt is settled in full or it is discharged or withdrawn. There are rules applying to discharge or withdrawal of a tax lien and it does not always mean the tax is not payable.
A tax lien gives priority to the federal or state government over other creditors, unless a certificate of subordination is issued, which allows other creditors to move ahead of the IRS.
What is a Charge in the UK?
Similar systems apply in most countries, they just call them different names. In the UK it is known as a charge on the property. The main difference between the UK and the US systems is that the Inland Revenue does not become the first person to be paid if the property is sold. Whoever gave a mortgage for the property has what is known as the 1st charge. There could be other charges too, all given priority by the number they hold. The Inland Revenue could be 4th or 5th charge, and that would mean they would have to wait in the queue until previous charges have been settled.
Garnishee or Bankruptcy in Australia
Australia has some of the toughest rules when it comes to people not paying their taxes. You only have 21 days from when it becomes due to settle the debt or come to an arrangement to do so. Then the Australian Tax Office has two options. They can either issue a garnishee order or make you bankrupt. A garnishee order is a notice sent to anyone that is likely to owe you money in the future, instructing them to pay it to the tax office instead. This is a legal document that the recipient has to abide by.
Pay Your Taxes When They are Due
The simple answer is to pay your taxes when they are due and if you cannot, do not ignore the matter. Speaking with the relevant department and agreeing to some sort of payment plan is better than doing nothing at all.