Direct Recovery of Debts is working, shows report

Direct Recovery of Debts (DRD) has achieved its policy objectives and contributed towards collecting ￡178 million of tax revenue, according to a new report from HMRC.

DRD was introduced in November 2015 and gives HMRC the power to recover established debts directly from debtors’ bank and building society accounts. The initiative specifically targets those who can and should pay, but who repeatedly refuse to do so.

The report reviewed DRD’s activity from April 2016 until December 2018. It considers whether the key policy objectives – reducing tax debt owed by securing payment in full, ensuring a fairer tax system and providing better value for money – have been achieved by focusing on: effectiveness in collecting tax debt and impact on debtors, including vulnerable taxpayers.

The report found that DRD is working effectively and that the low volume of complaints, objections and appeals, the low number of those upheld, and the identification of vulnerable customers, confirms that the correct debtors are being identified.

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