HM Revenue and Customs turns to debt collectors
Despite the recent controversy about tactics used by debt collectors, HM Revenue and Customs has announced that it will begin to use the agencies in order to improve its collections rates of outstanding tax.
This week, as part of a special six month trial, HMRC will send out letters to certain individuals and businesses warning that they will be referred to a debt collection agency unless they contact the government department.
A spokesman for HMRC has commented: We retain a flexible approach to ensure we get the best result for the taxpayer. Using private sector capacity has the potential to complement this approach and that is what we are now exploring.
Only one agency has been chosen to work with HMRC, having shown that it is fully compliant with the code of practices and procedures that HMRC follows.
Following a string of warnings from the Office of Fair Trading (OFT) debt collection agencies have come under fire for using aggressive or underhand tactics to recover debt. HMRC has said that the agency will only write to or call debtors and will not be allowed to visit late payers homes or workplaces.