Direct Recovery of Debts
DRD was introduced in 2015 to give HMRC direct powers to recover debt from bank accounts. It applies to debts over £1,000 where HMRC has been unable to collect through other means.
HMRC must give you at least 30 days notice before using DRD. During this time you can pay, arrange a Time to Pay, or challenge the debt.
HMRC must leave £5,000 across all your accounts. Any amount above this can be taken up to the value of the debt.
Safeguards for vulnerable people
HMRC has committed to face-to-face visits before using DRD, particularly for vulnerable customers. This is to give people the chance to arrange payment or raise dispute.
DRD cannot be used for cases where HMRC identifies significant hardship or vulnerability without additional review.
Practical implications
For most people, DRD is not the first line of collection. HMRC will usually try letters, phone calls, and Time to Pay arrangements first.
DRD is a real risk if you ignore HMRC contact for a significant debt. Early engagement almost always avoids it.