HMRC struggles to collect ageing tax debts as millions of taxpayers fall behind on bills

Tax debt more than a year old and outside any repayment arrangement has surged from £5.3bn before the pandemic to £18.6bn. The National Audit Office warns that HMRC is increasingly struggling with debtors who refuse to engage at all. More than half the total balance is now over a year old, compared with 28% in 2019-20. Before Covid, the overall tax debt figure stood at around £15bn.
HMRC processed £103.6bn of new tax debt in 2025-26, twice the pre-pandemic average.
HMRC estimates its compliance drive since 2021 generated £10.7bn in additional revenue at a cost of £368m.
Nearly half of all new tax debt arising in 2025-26 is cleared within a month, much of it comprising bills that taxpayers had simply overlooked.
