HMRC Direct Recovery of Debts Safeguards

Following concerns raised over HMRC’s plans to directly recover unpaid tax from individuals’ bank accounts, the Chancellor George Osbourne last week announced a number of safeguards.

The Direct Recovery of Debts initiative was developed to give HMRC the power to directly recover amounts of unpaid tax from those suspected of tax avoidance. Concern was raised that thousands of innocent people would have money withdrawn from their bank accounts.

Recently a leaked memo, stated that HMRC had miscalculated the amount owed by a number of individuals.

Despite assurances that HMRC would only target those who have been “playing the system”, the Chancellor has agreed to safeguards which include:

• Face to face meetings with HMRC;
• An appeal process both to HMRC and through county court if unsuccessful;
• A specialist unit which will deal with individuals considered as vulnerable; and
• A helpline.

By targeting those that have refused to engage with HMRC and settle any amounts of underpaid tax, the scheme is expected to raise around £100 million per year.

It is thought that the new safeguards will assist in pushing the initiative towards draft legislation.

If you have underpaid tax, whether wittingly or unwittingly, you could fall onto HMRC’s radar and face the prospect of having money directly withdrawn from your bank account.

HMRC has developed a number of initiatives to clampdown on tax avoidance in the UK. We can assist those who fall under investigation by HMRC over alleged tax avoidance, or who may wish to make a voluntary disclosure of any underpaid tax.

For more information or to speak to one of our team in complete confidence, you can call us on 0113 387 5670 or fill out an Enquiry Form and we’ll get straight back to you.