HMRC spends £90m on private debt collectors

HM Revenue & Customs (HMRC) has spent £90m on private debt collectors in the last three years, almost triple the amount it spent in the three years before that (£34m), new analysis has revealed.

The data from accountancy firm UHY Hacker Young found that the UK tax agency spent £26m on private debt collectors in 2018 alone, compared to spending just £6m five years earlier. However, while the £26m figure indicated tremendous growth over the past five years, it was still lower than the £39m spent in 2017.

The revenue was granted the power utilise private debt collection companies in 2009 and currently uses 10 such firms. The private agencies write to those in arrears, with the debtors then expected to send them the money.

The accountancy practice, though, has raised concerns over the government’s use of private debt collectors, claiming it has adopted an “increasingly aggressive” approach, highlighting that, previously, debts have been chased that have already been collected.

A spokesperson for HMRC said, although it uses agencies, it does not use private sector bailiffs. The spokesperson emphasised that it encourages anyone “struggling with debt” to get in contact with the agency so it can help them.

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