HMRC resumes direct bank account tax recovery: What freelancers need to know
By
Tom May
Sesame, salt, and substance. A flagship bake.
Summary
HMRC has resumed using powers to withdraw unpaid tax directly from freelancers' bank accounts without court proceedings. The article explains the reality behind alarming headlines, noting that this power (Direct Recovery of Debts) has existed since 2015 and is only used as a last resort after multiple contact attempts. It provides practical advice for freelancers on how to avoid reaching this stage, including staying on top of tax returns, communicating with HMRC about payment difficulties, and setting up payment plans. The piece aims to calm fears while emphasizing the importance of proactive tax management.
Key quotes
· 3 pulledIf you're a freelancer, the phrase 'feast or famine' is one you're probably very familiar with.
When HMRC recently confirmed it will resume using powers to withdraw unpaid tax directly from bank accounts (without going through the courts), many of us felt a chill in the back of our necks.
The rollout of a policy doesn't always match the headlines.
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