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HMRC struggles to collect billions in ageing tax debt as millions of taxpayers fall behind on payments

HMRC struggles to collect billions in ageing tax debt as millions of taxpayers fall behind on payments

Tax arrears more than 12 months old and carrying no repayment arrangement have surged from £5.3bn before Covid to £18.6bn. HMRC now has 51% of everything it is owed sitting beyond the one-year mark, against just 28% in 2019-20. The agency is reportedly struggling to get a response from many debtors at all. Before the pandemic, the overall debt pile typically hovered around £15bn.

HMRC registered £103.6bn of new tax debt arising in 2025-26, roughly double pre-pandemic levels.

Its debt team has 5,600 staff and a £237m wage bill, plus £1.3bn in extra funding.

Ministers set a target to return debt to pre-pandemic levels but gave no deadline.

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