HMRC scales down use of Debt Collection Agencies

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The HMRC has more than halved its use of Debt Collection Agencies according to reported research conducted by Chartered Accountants UHY Hacker Young.

Their report suggests that the HMRC slashed use of DCA’s by more than 50% in 2014 compared with 2013.

Only £6.8 million was spent on using external Debt Collectors last year compared with a much larger sum of £14.8m in 2013

HMRC had been subject to much public criticism over its initial proposed use of third party debt collection agencies with many warning that overly aggressive practices may be used in the pursuit of outstanding debts.

There has also been many instances of a floors in the avenues of communication between both sides with reports surfacing of individuals being pursued for debts that they did not actually owe.

The HMRC began using Debt Collection Agencies in 2009 as it came under pressure from the government treasury to increase it tax revenue. This hit an all time high of £14.8m in 2013.

Since that date, new powers have been given to the HMRC to seize monies from individuals bank accounts and for disputed matters to be paid by the individual ‘up front’ prior to the completion of any investigations.

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