Revenue spending surges on private debt collectors

HMRC has spent more than £140m on private debt collectors in the past ten years according to figures from HMRC’s transparency data on departmental spending above £25 000 compiled by UHY Hacker Young. It spent £26.3m on private debt collectors in 2018 up more than 300% from the £6.2m five years ago. 

HMRC was given the power to use private debt collectors in 2009 and now employs ten agencies. The accountancy firm said there have been several examples of poor communication between HMRC and private debt collectors leading to debts being chased that had already been paid. 

Mark Giddens head of private client services at the firm said: ‘HMRC must strike the right balance between collection of tax and the welfare of taxpayers. It needs to ensure that external debt collectors are used as a last resort only.’ 

He added that ‘workable debt restructuring options are more effective...