News · HMRC
Can HMRC Take Money Straight From Your Bank Account?
Headlines are calling it "snooping powers". Here's what the rules actually say, what could change, and what to do if a tax bill is worrying you.
Quick answer
Yes, HMRC can already recover unpaid tax directly from bank accounts, but only as a last resort and with safeguards. If you pay on time, or you talk to HMRC early, this isn't aimed at you.
If a story about HMRC and your bank account has made you feel uneasy, you're not alone. Let's separate what's happening from what's being reported.
HMRC is expanding its use of "Direct Recovery of Debts" (DRD), which lets it require a bank or building society to pay unpaid tax straight from a customer's account. Press reports say further measures will feature in the upcoming Budget, with the aim of recovering billions in smaller outstanding tax debts.
How it works today
DRD isn't new. It was introduced in 2015, paused during the pandemic, and restarted by HMRC in September 2025, with wider use from April 2026. According to HMRC's own briefing, the safeguards include:
Only for established debts
The debt must be confirmed, the appeal window must have passed, and HMRC must have been ignored when trying to make contact.
Debts over £1,000
HMRC only considers DRD for tax and tax credit debts of more than £1,000.
£5,000 always left in your accounts
So money for wages, the mortgage and essential bills isn't frozen.
30 days to object
Funds are held, not paid over, while you object. If HMRC rejects it, you can appeal to the county court.
Individuals (not companies) are also due a face-to-face visit from HMRC before their debt is considered for DRD, and people who need extra support should be offered it.
What's being proposed
In June 2026, HMRC consulted on extending a similar power to lower-value tax debts. Key points from the consultation:
- It's aimed at customers who have repeatedly failed to respond to HMRC.
- Money could be collected through affordable monthly instalments rather than one lump sum.
- You would be notified in advance and given a final chance to pay or get in touch.
- HMRC doesn't expect debts in scope to exceed £10,000, and the exact limits haven't been decided.
What's still unconfirmed: Some reports suggest the minimum debt level and the £5,000 safeguard could change under the new regime. Those details haven't been confirmed, so we'll update this article once the Budget is out.
Who is this aimed at?
HMRC says about nine in ten customers pay in full and on time. These powers are for people and businesses who can afford to pay but choose not to, or who have stopped responding to HMRC. They are not random searches of ordinary accounts.
What should I do if I owe HMRC money?
- Don't ignore the letters. Silence is what triggers enforcement.
- Get in touch early. HMRC is far more flexible before a debt is escalated.
- Ask about Time to Pay. It spreads the cost, and HMRC says nine in ten agreements are completed successfully.
- Tell them if you're struggling. HMRC offers extra support for people in difficulty.
- Check your records. If you think a bill is wrong, object before the deadlines pass.
Worried about a tax bill or an HMRC letter?
Talk to us before it escalates. No jargon, no judgement.
Frequently asked questions
Can HMRC take money from my bank account without telling me?
Not under the current rules. HMRC only uses Direct Recovery of Debts on established debts where the appeal window has passed and it has been unable to get a response. Money is held for 30 days, so you have time to object before anything is transferred.
Does this affect people who pay their tax on time?
No. HMRC says around nine in ten customers pay in full and on time. These powers are aimed at people and businesses who can afford to pay but choose not to, or who have stopped responding.
What if I can't afford to pay my tax bill?
Get in touch with HMRC as early as you can. A Time to Pay arrangement lets you spread the cost, and HMRC says most agreements are completed successfully. Extra support is available if you're struggling.
Are the new proposals law yet?
No. The wider measures have been consulted on and are expected to feature in the Budget, but the details are still to be confirmed. We'll update this article when they are.
Staying ahead of it
The best protection is simple: keep your records up to date, know what you owe before the deadline, and speak up early if cash is tight. That's exactly why we work with our clients all year round rather than once a year. With monthly bookkeeping, you'll see your tax coming and plan for it.
⭐ 5-star Google reviews. Over 15 years helping businesses in Peterborough and Market Deeping.
Sources: HMRC, "Issue Briefing: Direct Recovery of Debts" (updated June 2026); HMRC consultation, "Proposals to tackle lower value tax debts" (June 2026); press coverage including The Telegraph.
This article is for general information only and isn't personal advice. Please speak to us about your own circumstances.
Get In Touch
Get In Touch With Us
Want a fixed monthly quote or a quick chat about switching accountants? Send us a message — we'll reply with clear next steps.
Worried about switching? Don't be.
You can move to Figures UK at any point in the year — no need to wait for year end. We handle the entire handover, including moving your records and transferring everything to HMRC, so the switch is seamless and stress-free for you.