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Tax Seizure Concerns

Written By On 09/05/2014

Tax officials are to be given the power to go into anyone’s account in order to get their hands on the funds required to settle unpaid tax bills.

George Osborne’s controversial idea announced in his recent budget has come up against fierce criticism from the Treasury Committee.

One of the duties of the select committee (appointed by the House of Commons) is to investigate the policies of HM Revenue & Customs. They are clearly very worried that this may cause many more problems than resolutions.

The chancellor proposed his new plans for HMRC to collect late payments in this way from any person having an outstanding debt of at least £1,000 in either tax or tax credit.

It permits the authority to grab the money straight from the account without the holder being able to do anything about it. At the moment a court order must be required to be able to snatch any outstanding debts.

But the committee, made up of thirteen MP’s, do not carry the same amount of confidence as Mr Osborne that HMRC will calculate the tax that is due correctly.

Their chairman Andrew Tyrie states:

People should pay the right amount of tax, but HMRC does not always ask for the right amount. Some taxpayers may find money taken from their accounts that later should be paid back and that would be unacceptable.

The tax authority say they intend to only go after debtors with outstanding long term amounts owing. Those who have continually ignored their tax demands at least four times are the ones to be focussed upon.

They insist they will not leave a person with less than a total sum of £5,000 across all their accounts after payment is taken. They also explain how primarily they will freeze the specific debt for two weeks allowing the account holder to settle up first.