Contracts have been signed with Commercial Collection Services Ltd, Credit Solutions Ltd, Fairfax Solicitors Ltd and iQor Recovery Services Ltd.
In the 2010 Emergency Budget it was decided that, following a triumphant pilot, HMRC would use Debt Collection Agencies to enhance HMRC’s collection ability and help them to pursue lower value debts.
HMRC Director of Debt Management and Banking, Nick Lodge, said that the ‘DCAs give HMRC vital additional capacity, strengthening our ability to pursue the debts of those who decline to pay.’
HMRC have stated however that they do understand that some individuals or businesses have genuine difficulty in paying debts and the Debt Collection Agencies will be used to pursue those who simply refuse to pay their tax debts.
However, before you start panicking that you will have the bailiffs knocking on your door for a £100 late filing penalty, HMRC will write to debtors offering a final opportunity to pay their tax debt or come to a payment agreement before it is passed on to a Debt Collection Agency.