Government plans to let HMRC recover unpaid tax and tax credits directly from debtor’s bank accounts have been slated by City lawyers.
HMRC’s consultation on new direct recovery powers, Direct Recovery of Debts, closed this week. Accounts would be raided where the debtor owed at least £1,000 and HMRC would leave a minimum of £5,000 in the account.
However, the City of London Law Society said the proposals were “seriously misguided”, had inadequate safeguards and were susceptible to challenge under the Human Rights Act.
In a letter to HMRC, Simon Yates, chair of the Society’s revenue law committee, said the society’s “fundamental objections” were that it would be HMRC and not the judiciary making decision on when to use direct recovery, and the “real potential” for mistakes to be made.
