HMRC enforcers: ‘I’ve had to borrow from friends just to survive . . . I’m so stressed I can’t eat’

While millions of high earners benefit from financial aid during the pandemic, HM Revenue & Customs and local councils have pursued families on low incomes for relatively small amounts in tax. In more than 1,000 cases since April people have been visited at business premises by HMRC enforcement staff.

Paul Morgan-Bentley, Head of Investigations 

Thousands of others have been sent letters and text messages from private debt collection agencies used by HMRC, including care home workers, those who have been unwell with Covid-19 and the vulnerable.

‘I got the letter, went upstairs and cried’

Tax officials have been shamed into dropping a case against a young mother after her MP accused them of chasing her for £2,000 in error and causing her distress during the pandemic.

Patricia Gibson, MP for North Ayrshire & Arran, wrote to HM Revenue & Customs in September asking officials to “cease the action being taken” against a constituent, whom she described as “a young mother on low income”.

The woman, who is 27 and has two children aged seven and one, claimed tax credits for five years to top up her £9,000-a-year earnings as a part-time hairdresser. In July 2018, she phoned HMRC to stop the benefits because her circumstances had changed and she was moving to England with her husband, who was in the army.

A call handler told her that the only way she could do this before the end of the financial year was to submit exaggerated earnings of £30,000 while she was on the telephone. She went along with the suggestion and her tax credits stopped. However, this year she received a repayment demand, wrongly claiming she owed £2,078 in tax credit overpayments.

In her letter Ms Gibson wrote that the constituent was then reassured during another call with HMRC that the matter would be resolved. Despite this, she was contacted at home by debt collectors in August. The young mother, who asked not to be named, told The Times that 1st Locate, a debt collection agency working with the Revenue, wrote to her at home, texted her and tried to phone her.

“I was devastated,” she said. “The day I got the letter I went straight upstairs, put my baby to sleep and then cried on my bed.”

1st Locate said it could not comment on individual cases. It said that it was regulated by the Financial Conduct Authority, subject to extensive due diligence and trained to identify and help vulnerable customers and assess affordability.

‘I’ve been shielding, and now I’ve been threatened that someone could turn up at my home’

A freelance office manager who was unable to work while undergoing chemotherapy and radiotherapy for cancer during the pandemic has told of her emotional trauma after HMRC gave her financial details to debt collectors.

The woman, in her fifties, had spoken to HMRC and it agreed that she could defer a tax bill. Six months later, however, she received a letter from debt collectors stating that she should urgently pay more than £5,000.

“I am so distressed by how HMRC have acted,” the woman, who asked not to be named, told The Times. “I have been shielding and so spent months without seeing friends and family, and now I’ve been threatened that someone could turn up at my home.”

After calling the firm, it agreed to close her case and return it to HMRC, which told her it passed it on in error.

HMRC said it could not comment on the specific cases without the taxpayers’ permission.

“I’m terrified. HMRC staff lack human empathy”

HMRC staff added interest to Kirsty Howe’s company tax bill after she called them for help while struggling to cope financially during the pandemic.

Ms Howe, 52, who runs a small company that manages diaries for camera crews, was unable to make any money for months this year after television production stopped. She has until the end of the year to pay a £9,400 corporation tax bill for the 2019-20 financial year but phoned HMRC before the deadline to ask to start a payment plan.

With her son George, 21, moving back home with her in Brighton and only about £500 per month from the furlough scheme, she feared she would be unable to save enough to pay the whole tax bill in time. She has had a mortgage holiday but has to start paying £750 a month again this month.

Ms Howe assumed HMRC staff would take kindly to her being conscientious and trying to set up a payment plan. Instead, they tried to persuade her to wait to see whether she could pay it in full. A call handler agreed she could pay £5,000 immediately and cover the remaining £4,400 throughout next year if she also paid interest at 2.6 per cent. The rate is applied to late payments and will start being added to Ms Howe’s company account in 2021.

“I’m so upset and angry,” she said. “Why am I being charged extra? I was acting responsibly and doing the right thing in asking to set up a payment plan. I am terrified by HMRC. They won’t budge. It is like they lack human empathy.”

Ms Howe’s small business, the Firm Booking Company, is now making about 40 per cent of its usual income. “There has been so much help for so many big corporations,” she said. “It does not make sense that a small business owner like me is penalised.”

HMRC said applying interest in Ms Howe’s case was “standard practice for any debt” and that it “followed correct protocol and process in the case and agreed a manageable payment plan”.

Care home worker told belongings could be sold

Richard Hull, 59, has told of the “immense struggle” to cope financially after he and his wife were unwell with Covid-19 before being threatened with repossessions by HMRC. The self-employed carpenter, from East Grinstead, West Sussex, owes £9,733 in tax but is unable to raise the funds because almost all of his customers have delayed or cancelled works.

He told The Times that he was struggling to cover bills at home, where he lives with his wife, Teresa, 47, who works part-time as a cleaner in a care home, and their 11-year-old son. He has had a pay-as-you-go gas meter installed for the winter to prevent heating bills rising too high. In recent weeks their landline has been cut off and his car has been repossessed. He has been rejected for help from the self-employment income support scheme because of a previous late tax return.

He was contacted by HMRC about his tax debt before his case was passed on to private debt collectors. After failing to settle the bill, he received another letter in October from HMRC’s internal staff, which said that his debt had been increased to £10,327 and threatened repossessions. It stated: “Continuing to not pay what you owe is a serious matter. Previously, we treated this as something you didn’t mean to do. However, if you still don’t pay, we’ll now treat you like you’ve deliberately chosen not to.”

It stated that the law allowed HMRC to take action to collect the money owed, adding: “We can take things you own and sell them and we charge you fees for doing this. If you don’t act now it could cost you more money. Alternatively, in certain circumstances we can take money directly from your bank or building society accounts.”

It directed him to a government web page explaining that officials can visit him at home, make a list of his possessions and take them immediately, while charging hundreds of pounds in fees.

Mr Hull and his wife had the coronavirus in April. He said that he tried to respond to previous letters from Advantis Credit, a debt company used by HMRC, but was unable to get hold of its staff on the phone.

“It has been an immense struggle,” Mr Hull said. “I have had to borrow money from friends and ask for advances from customers, so when I eventually do the work I’ll only be paid half. This is just so we can survive.

“The letters have become increasingly threatening — saying they will come and take our possessions and sell them. I am so stressed that I’m hardly eating and my hair has been falling out.

“I know someone on £80,000 a year with £50,000 in savings who has been furloughed. How is it fair that we are being chased for a tax debt that it’s impossible for us to pay at the moment?”

Advantis Credit said that it was regulated and “we take our commitment to delivering fair treatment of customers extremely seriously”, including performing affordability assessments, helping vulnerable customers and providing support during the pandemic. A spokeswoman said that it was unable to comment on individual accounts.

HMRC said the letter “was a mistake and does not reflect our current approach to debt collection”. A spokesman said: “We apologise for any distress caused to Mr Hull and have put in measures to stop this happening again. We will make contact with Mr Hull to discuss and agree a way forward.”

Suicidal man was threatened with a home visit

A vulnerable man who tried to commit suicide last month is among those who have been threatened with bailiff visits because of owed council tax.

The man, whom The Times has chosen not to name, was on benefits for the first time and living alone when he received a letter in August from Bristow & Sutor, a company hired by his local authority to collect unpaid council tax. It stated he owed £1,186 — a figure he contested — and that he could pay the full amount in a week or in instalments for three months. It said that local authorities needed the money “to ensure vital services can be delivered, whilst also helping those in need”.

“It was threatening to say they were going to come round to my home and give me aggravation,” he said. “I’ve been living alone because my partner had to move in with her mother because of coronavirus. I was scared.

“The idea of them coming to my home gave me a lot of anxiety. It has been the most stressful time in my life and it has affected my mental health.”

The man, who is in his 50s, handed in his notice at a restaurant at the beginning of this year after being offered a job elsewhere. The job offer was withdrawn because of the pandemic and he had to sign up for universal credit.

The letter that he received in August related to council tax that he did not pay when he moved from his previous home to the flat in which he now lives. He acknowledged that he owed a few months of payments but the council said he owed money in three consecutive financial years and the full amount was signed off by a magistrates’ court.

He told the company he was happy to pay what he owed but was warned that contesting the charge would be a lengthy process. He agreed to a six-month payment plan without knowing how he was going to afford it. “I wasn’t able to work for months,” he said. “My doctor put me on antidepressants.”

He attempted to take his own life in November and after staying overnight in hospital is being supported by a debt charity and doctors. He has recently got a new job and is continuing to pay back his council debt. There is no suggestion that the actions of Bristow & Sutor caused him to try to take his own life.

Bristow & Sutor said it had been given no indication that he was vulnerable and did not attend his home. Its letter stated that it could offer “more flexible payment terms” due to the pandemic. It said it was “sorry to hear about this person’s circumstances” and that it was going “above and beyond to achieve a high standard of ethics and professionalism”, including training staff to identify and help vulnerable customers.

The council said that the case was passed to Bristow & Sutor before the pandemic and it had not known the man was vulnerable. The debt has now been sent back to the council and arrangements for him to repay will only be made once he has recovered. A spokeswoman said that enforcement action was taken only as a last resort.

The debt collection agencies said that they were regulated by the Financial Conduct Authority and trained to identify and help vulnerable customers and assess affordability. They said they have offered additional support during the pandemic including changes to repayment terms and are subject to extensive due diligence overseen by HMRC.

After being contacted by this newspaper, HMRC apologised for about 800 letters it had sent during the pandemic accusing people of deliberately not repaying debts. HMRC said that repossession “is only mentioned in a letter after we have already made several attempts to contact a customer” and that less than 1 per cent of field force collector cases lead to goods being removed.

HMRC said that it stopped debt collection activities in March but contacted a million people with tax debts built up before the pandemic when restrictions were lifted in some areas, allowing them to agree to more than 500,000 payment plans covering £4 billion in debts. It said that visits to work premises “have not been to list or collect assets, but to discuss the customer’s ability to pay during the pandemic and offer support”.

A spokesman said that contact initially focused on working with people to help them to find an affordable way forward and “more strongly worded communications only go out as a last resort where customers have not responded to our initial communications”.

He said: “The last thing we want to do is cause anyone more worry at this difficult time but it remains vital the tax system continues to function to pay for vital public services, like the NHS.”

For confidential support, call the Samaritans on 116 123 or visit a local branch. See

This article was updated on 10 December 2020.