UK Budget may let HMRC take unpaid tax directly from bank accounts

The UK government is expected to give HMRC new powers to take unpaid tax directly from bank accounts, under plans due to be announced at the Budget.

The powers would cover current and savings accounts, and could apply to debts of only a few pounds, rather than the current rules’ £1,000 minimum.

HMRC says about 4.8 million people and businesses owe less than £10,000 each, with debts totalling £4 billion.

The government is seeking to reduce unpaid tax as part of efforts to tackle the UK’s £60 billion tax gap.

Critics warn errors could affect vulnerable people, while a senior government source says protections would be rigorous.

The Chancellor is expected to set out the plans at the Budget, but the Treasury has not commented ahead of the announcement.