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MPs dubious over new debt recovery measures for HMRC

Treasury Select Committee MPs have censured the extended powers granted to HMRC.

The committee emphasised the concern expressed by practitioners regarding potential debt recovery errors, considering the fact that a number of mistakes having been made by the department in the past.

The chancellor proposed “modern powers” in the Budget that enable HMRC to recover unpaid funds directly from tax payers’ bank or building society accounts, which includes ISAs.

The official Budget document revealed that the new powers will see those who owe a minimum of £1,000, even after HMRC has attempted to get in contact with them, targeted. It also said that a single £5,000 aggregate will remain across accounts, which includes ISAs, once the debt has been recovered.

Andrew Tyrie, committee chairman, said:

“This policy is highly dependent on HMRC’s ability accurately to determine which taxpayers owe money and what amounts they owe, an ability not always demonstrated in the past.

“Incorrectly collecting money will result in serious detriment to taxpayers.”

Critics are also drawing attention to the powers’ legality, with Mark Garnier, Conservative MP and committee member, saying that HMRC believes it is the judge as well as jury.

The committee’s report said that should HMRC be given the proposed powers without any independent observation, the situation would be unacceptable.

Those who outsource to reputable accountants in the Wirral, and up and down the country, have peace of mind in knowing that their books are in capable hands – and that the chances of their bank accounts being raided by HMRC are significantly minimised.

Posted by Peter
May 15, 2014
Tax

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