HMRC to recover unpaid tax directly from bank accounts

HMRC to recover unpaid tax directly from bank accounts

​Restart. In a bid to reduce tax debt, HMRC is relaunching its direct debt recovery (DRD) process, whereby outstanding debts can be collected from non-taxpayers' bank accounts. It was paused during the pandemic but the threat of using it was effective when previously employed.

​Safeguarding. There's no need to panic as it's used very rarely. Essentially, it is enforced where a debtor has the means to pay their tax debts but chooses not to. It can be used to recover debts over £1,000, subject to various safeguarding rules. For example, it can only be used where the debtor has received a face-to-face visit from HMRC agents (having ignored previous correspondence), has not been identified as vulnerable, has sufficient money in the bank and still refuses to pay their debts.

​Time to pay. If you're struggling to pay your tax bill, contact HMRC as soon as possible to ask about setting up a payment plan.

​HMRC is restarting the direct debt recovery process where it can recover unpaid taxes directly from the bank accounts from those that can afford to pay their tax debts but refuse to. This is only used in extreme circumstances due to strict safeguarding provisions.