Tax inspectors will be allowed to raid people’s bank accounts to claw back unpaid bills in a tough new crackdown on dodgers who ignore repeated warnings.
The HMRC is igniting “direct recovery” powers which let it swoop on bank accounts if someone has the cash to pay but “chooses not to do so”.
The move — quietly tucked into the Spring Statement — is aimed at tackling tax avoidance and evasion, with the Treasury hoping to rake in an extra £1billion.
The measure was originally rolled out back in 2015, but was paused during the pandemic. Now it’s back — and anyone who owes more than £1,000 and ignores multiple reminders could see HMRC helping themselves to what they say is owed.
But taxmen must leave at least £5,000 in the person’s accounts, and they can only act once the appeal deadline has passed.
A government document confirmed:
“HMRC will re-start ‘direct recovery’ of tax debts owed by individuals and companies who have the ability to pay but choose not to do so.”
TELL ON YOUR FAMILY MEMBERS FOR CASH
The Labour Chancellor Rachel Reeves is also offering cash rewards to people who snitch on family or ex-bosses dodging tax. A new US-style informer scheme will pay out to tipsters who tell HMRC about underpayments.
And that’s not all — banks may be forced to hand over more personal details, like National Insurance numbers, so HMRC can more easily match savers to their tax bills.
The Treasury says it’s about closing the gap on billions lost every year. HMRC reckons £5.5bn a year is lost to business tax evasion — though MPs say it could be much higher. Back in 2019, the direct recovery powers were found to have pulled in an extra £178million in tax.
AUTOMATIC PAYDAYS FOR HMRC?
There are also plans to automate the debt collection process for lower-value debts — meaning computers, not humans, could soon decide when your cash gets lifted.
Critics say the plans risk squeezing the wrong people, but HMRC insists it will only target those who have the means but still refuse to pay.
Still, with rising bills, stealth taxes, and now the taxman eyeing your bank account — British business owners will be wondering: how much is too much?
