HMRC to begin taking money from bank accounts in bid to close £47bn tax gap
The people HMRC will target for its ‘Direct Recovery of Debts’
- HMRC is reinstating its 'Direct Recovery of Debts' powers, allowing it to take unpaid tax directly from bank accounts, building societies, and ISA providers.
- The measure targets individuals and businesses who owe £1,000 or more, have ignored communications, and can afford to pay but refuse to do so.
- HMRC states the powers will be used with "stringent safeguards," including a requirement for an agent visit and not leaving less than £5,000 in an account after recovery.
- The tax authority paused these powers during the Covid pandemic, having previously used them sparingly between 2015 and 2018.
- The reintroduction of these powers, part of efforts to address an estimated £46.8bn tax gap, precedes similar powers for the Department for Work and Pensions under the upcoming Public Authorities Bill, raising concerns among campaigners.