HMRC have dusted off their direct recovery powers. Owe more than £1,000 and ignore the bill? They can now take the money straight from your bank account (yes, including a cash ISA). These powers were introduced in 2015, paused during the pandemic, and are back in a “test and learn” phase. HMRC say they’ll visit first, leave at least £5,000 in your account, and only act after appeals are over.
My view? If someone can pay their tax, then of course it should be recovered. Fair’s fair.
My problem is how often HMRC get it wrong and how long they take to fix it. It’s a joke. I simply don’t trust them to use big powers with good accuracy or speed.
And about savings.... the real change is coming in 2027
From 2027, the big shift isn’t HMRC raiding your savings, it’s better data. Banks and building societies will be required to report savings interest to HMRC in a more standardised, timely way, so HMRC can pre-populate records and adjust tax codes more accurately (instead of relying on late, patchy info or pushing you into Self Assessment unnecessarily).
That makes perfect sense. The UK is miles behind other countries on pre-filled, data-led tax — this is a sensible modernisation. Just to be crystal clear: this is about improving reporting and calculation, not HMRC yanking cash out of your savings.
Bottom line
• Direct recovery: fine in principle if used correctly, but HMRC’s track record on mistakes and delays makes me very nervous.
• Savings from 2027: thumbs up. Modern, overdue, and likely to reduce errors if HMRC actually uses the data properly.
Worried HMRC might dip into your account or want to know how the 2027 savings changes will affect you? Call 01789 773 182 or email info@chadwickaccountants.co.uk we’ll keep you on the right side of all this.
