What is a Controlled Goods Agreement Letter From HMRC?
The form, when it lands on your desk, is called “Notice of Intention to Take Control of Goods” or, increasingly, simply a Controlled Goods Agreement. It arrives because enforcement agents, working for HMRC, a landlord, or a judgment creditor, have the legal right to list your company’s assets on the premises and leave them there, intact but notionally under their control, pending payment.
Signing it feels like capitulation. Refusing to sign it feels like resistance. Both instincts are wrong. The Controlled Goods Agreement (CGA) is a specific legal instrument with defined consequences under the Tribunals, Courts and Enforcement Act 2007, and the right response depends on your underlying debt, your position as director, and the alternatives available in the following hours.
Below you will find what a CGA is, when it is used, what can and cannot be seized, and how you should respond when one is presented.
What a Controlled Goods Agreement Is
A Controlled Goods Agreement is a written agreement, under paragraph 13 of Schedule 12 to the Tribunals, Courts and Enforcement Act 2007, between an enforcement agent and the debtor. Under its terms:
- The enforcement agent identifies and lists specific goods on the debtor’s premises.
- The listed goods remain physically with the debtor, not removed, but are legally “under control”.
- The debtor agrees not to dispose of, damage, or move the listed goods while the CGA is in place.
- Breaching the CGA is a criminal offence, and the agent can return to remove the goods for sale.
The CGA is an intermediate step in the enforcement ladder. It sits between the initial Notice of Enforcement (seven days’ warning that agents will attend) and physical removal of goods for sale. In our experience, directors who understand this structure respond far more effectively than those who treat it as an immediate emergency or ignore it entirely.
The CGA gives your company one more window to settle before the assets are removed.
When a Controlled Goods Agreement Is Used Against a Company
CGAs are deployed by certified enforcement agents across several creditor types. In our practice, HMRC-related CGAs are the most common we see for struggling limited companies:
- HMRC distraint, for tax debt enforcement, following a Notice of Enforcement. HMRC uses both in-house field officers and certified external agents.
- Court judgment enforcement, after a creditor obtains a CCJ, a warrant of control enables certified agents to attend the debtor’s premises.
- Commercial Rent Arrears Recovery (CRAR), landlords can instruct enforcement agents under Part 3 of the 2007 Act where rent is seven or more days in arrears.
- Business rates, local authorities enforce unpaid rates through certified agents under the same statutory regime.
The specific type of creditor changes the fee scale and the removable asset categories, but the CGA mechanism operates the same way across all of them. In every case, the enforcement agent must be certified, must carry proof of authorisation, and must follow the procedural steps in the 2007 Act. If you believe the agent is not certified, ask to see their credentials immediately.
What Can and Cannot Be Seized Under a Controlled Goods Agreement
The exempt-goods list under the Taking Control of Goods Regulations 2013 is more protective than most directors assume. Enforcement agents cannot take control of these categories, so you should review your asset list against them before the agent attends:
- Tools and equipment necessary for the debtor’s personal use in their employment, business, or vocation, up to a total value of £1,350.
- Basic household items, bedding, clothing, a cooker, a fridge, a washing machine (in domestic premises).
- Assets owned by third parties, including leased or hire-purchase equipment where title remains with the supplier until fully paid.
- Stock subject to retention of title clauses, where the supplier has properly reserved title in the supply contract.
- Assets subject to a fixed charge in favour of a secured creditor.
- Perishable goods, except where the agent has specific authority and arrangements to realise them quickly.
For a typical small company, the exemption list can exclude a material proportion of apparently seizable assets. Your vehicles on finance, plant and machinery on hire-purchase, stock subject to supplier retention of title, and office equipment jointly used for residential purposes can each fall outside the agent’s reach.
Producing documentary evidence of third-party title at the point of the agent’s visit, your HP agreements, lease documents, and supplier contracts with ROT clauses, is the practical step that keeps those assets off the controlled list. Have that paperwork ready before the agent arrives.
Do You Have to Sign a Controlled Goods Agreement?
Strictly speaking, no. A CGA requires your consent. But the alternative to signing is rarely better for your company.
If the debtor refuses to sign the CGA, the enforcement agent has three main options:
- Remove the goods immediately for sale. This is the practical consequence of refusing a CGA in most cases, the agent simply proceeds to the next stage of the enforcement ladder.
- Secure the goods on the premises (locked cabinets, padlocks) without the debtor’s consent, where the legislation permits.
- Return with reinforcement, including a locksmith or police presence where obstruction is anticipated.
Signing the CGA is usually the lesser of two commercial harms: your goods stay on the premises, your business continues to operate, and you have a further window (typically seven to fourteen days) to pay the debt and the enforcement fees. Refusing typically produces immediate removal and a far more disruptive outcome.
The one exception: where the listed goods are clearly exempt or third-party-owned, signing an agreement that purports to control them creates an evidential problem you do not need later. Flag the exemption at the point of signing, in writing on the agreement itself.
Disputing or Appealing a Controlled Goods Agreement
If you believe the CGA is defective, disputed, or improperly made, the routes to challenge it are:
- Third-party claim to exempt goods, where assets listed in the CGA are owned by a third party, the owner can make a claim within seven days under paragraph 60 of Schedule 12. The agent must suspend enforcement pending investigation.
- Complaint to the creditor about procedural errors, overreach, or disputed debt. Creditors can recall agents if the complaint has merit.
- Application to the County Court for relief, including an order that the agent’s action was unlawful and for the return of goods or damages.
- Complaint to the relevant professional body (Civil Enforcement Association, certified bailiff register) about enforcement-agent conduct.
Challenges work best when supported by your documentary evidence, title documents, supplier contracts, and lease agreements, produced at the time. Retrospective challenges, without evidence contemporaneously preserved, are much harder to sustain. We see this regularly: directors who keep the paperwork organised settle disputes in hours; those who search retrospectively rarely succeed.
Warning Letters Before HMRC Enforcement Action
HMRC is required to provide specific warnings before moving to enforcement. If you have not received all three of the following, you should verify the position before engaging with the agent:
- Reminder and final notice letters through standard debt management correspondence.
- “Enforcement by Taking Control of Goods” letter giving notice that enforcement agents will attend.
- Notice of Enforcement (Form NOE), the statutory seven-day notice required under the 2013 Regulations before an agent can attend.
That seven-day window is your last, cheapest opportunity to stop the process. A payment or a Time to Pay arrangement agreed inside the seven days prevents the visit entirely.
If you ignore the notice, our team regularly sees directors end up facing the visit, the CGA, and the enforcement fees that follow, all avoidable costs.
Enforcement Agent Fees Attached to a Controlled Goods Agreement
The statutory fee scale under the Taking Control of Goods (Fees) Regulations 2014. In our advisory work, these fees are one of the first things we help directors calculate before deciding whether to pay, negotiate, or seek formal insolvency protection:
- Compliance stage, £75 on instruction, before any attendance.
- Enforcement stage, £235 plus 7.5% of any debt over £1,500 on first attendance (which is when the CGA is usually made).
- Sale or disposal stage, £110 plus 7.5% of debt over £1,500 on removal of goods.
For a £5,000 debt, the full enforcement fee stack runs to roughly £945. If you pay before the enforcement stage, within your seven-day notice window, you save everything beyond the £75 compliance fee. That is a straightforward calculation worth making before the agent arrives.
Next Steps After Receiving a Controlled Goods Agreement
The practical sequence, in priority order. Where these steps conflict with advice you have already received, call our team before acting:
- Review the CGA carefully before signing. Identify any listed goods that are third-party-owned, on finance, or subject to ROT clauses. Annotate the agreement before signature.
- Negotiate a payment arrangement with the creditor during the CGA window. The goods stay on the premises; payment within the window can avoid the sale stage entirely.
- Seek licensed insolvency practitioner advice where the CGA sits alongside broader creditor pressure. A CGA in isolation is manageable; a CGA plus HMRC arrears plus supplier demands signals cash-flow insolvency.
- Do not breach the CGA. Moving, selling, or damaging listed goods is a criminal offence and accelerates the enforcement outcome.
- Consider the insolvency position. Where the CGA reflects a company that cannot pay its debts as they fall due, cash-flow insolvency is in view and director duties have shifted. Formal process may be the cleaner route.
Our licensed insolvency practitioners and business rescue specialists can assess your position, negotiate directly with the creditor where necessary, and implement a formal process where your company’s situation requires it. Call us free on 0800 074 6757 for confidential advice.
Controlled Goods Agreement FAQs
What happens if I sign a Controlled Goods Agreement and cannot pay?
The enforcement agent returns after the agreed window to remove the goods for sale. The sale proceeds settle the debt and enforcement fees; any surplus returns to the debtor. In practice, agents value goods at auction-realisable prices, which are typically well below market value, so the actual benefit to the creditor is usually less than the agent’s valuation suggests.
Can I remove or sell goods listed on a CGA?
No. Moving, disposing of, or damaging goods under a Controlled Goods Agreement is a criminal offence under paragraph 68 of Schedule 12 to the Tribunals, Courts and Enforcement Act 2007. The offence carries a fine and accelerates enforcement action; agents can return immediately to remove any remaining assets.
Are leased or hire-purchase assets exempt from a CGA?
Yes, where title has not passed to the debtor. Leased equipment remains the lessor’s property; hire-purchase goods remain the finance company’s until the final payment. Producing the finance documentation at the agent’s visit keeps these assets off the controlled list. Agents should not include them, but they sometimes do if the documentation is not produced.
Can I stop the enforcement agent entering the premises?
For commercial premises, enforcement agents have statutory rights of entry during reasonable hours, including forced entry after giving notice where necessary. For residential premises or mixed-use premises, the rules are stricter, forced entry is generally not permitted except with court authority. Refusing entry at commercial premises typically delays the visit rather than preventing it.
How long does a Controlled Goods Agreement last?
Typically seven to fourteen days, set in the agreement itself. The agent returns at the end of the agreed period to either confirm payment (ending the enforcement) or remove the listed goods. Extensions can be negotiated where partial payment has been made and the creditor agrees.
Methodology & Disclosure
This guide is written by the Company Debt editorial team, reviewed by licensed insolvency practitioners, and reflects UK enforcement law and practice as at the last-reviewed date. Statutory references are drawn from the Tribunals, Courts and Enforcement Act 2007 (Schedule 12), the Taking Control of Goods Regulations 2013, and the Taking Control of Goods (Fees) Regulations 2014.
Company Debt is an insolvency advisory firm. Where enforcement action reflects underlying cash-flow insolvency, we can act as the licensed Insolvency Practitioner for a recommended CVA, Administration, or CVL under separate engagement. The 0800 number is a free confidential consultation.
