Revenue takes tough stance on debt recovery

HMRC is making widespread use of powers to deduct cash straight from the earnings of individuals with 428 people having cash taken straight from their pay packets in 2017-18 according to a freedom of information request obtained by UHY Hacker Young.

The accountancy firm said this method of debt recovery known as ‘attachment of earnings’ orders does not allow individuals to reduce payments to HMRC if they are short of money one month. When the department has to seize control of goods and sell them through auctions the process can often drag out for long periods before debts are fully recovered.

To determine how much a debtor should pay from their earnings the court works out a minimum amount the debtor needs to live on known as the ‘protected earnings rate’. The sum owed is then deducted from money earned above this amount.

Simon Browning ...