HMRC building

HMRC has awarded itself new powers to access your accounts for a year, it has been reported.

The tax authority has drawn up plans to seize the account details of anyone who they claim may owe them some money.

These new powers come just months after it announced that they can dip into the accounts of those it accuses of missing tax payments.

It will also be able to deduct the legal costs of anyone who is embroiled in a court case with it, if HMRC believes it is likely to win a court case – leaving people with no money to defend themselves adequately or get legal representation.

Now, Lin Homer, chief executive of HMRC said she wants to be able to ask banks or building societies to hand over 12 months of a person’s bank or Isa statements.

This will allow the tax authority to check that there will be enough money in the account when they decide to swipe money from it.

Scarily, its powers do not stop there. HMRC also want to be able to extend the powers to other organisations and corporations to retrieve money owed for things such as TV licences or car tax.

Ms Homer herself has admitted that the tax authority may be prone to making mistakes. Effectively, HMRC will be able to elect itself as judge, jury and executioner.

It also goes against the grain of established democratic principles where guilt has to be proven in a court of law before a penalty takes place.

This new law represents a sharp diversion from those principles.

However, some politicians have opposed the measures.

Labour MP George Mudie said: “This is another intrusion into people’s lives. You are going to have the power to get 12 months’ bank accounts from people, building societies… the lot.”

This was followed up by Liberal Democrat John Thurso, who added: “‘We are talking here about the ability for one organisation of state… to have the unique right to go against the Magna Carta and all the other things we have established and to go in and seize – without judicial process or review – a bank account.”

However, HMRC has defended its move by saying that proving its allegations in a court case was too much of an inconvenience.

Ms Homer explained: “Of course, we can go to court, but the cost both in time and money of going to court will often outweigh or seriously diminish the amount of tax collected.”

Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants, said these new powers represent a slippery slope.

He explained: “There is a dangerous sense of “Big Brother” about it.
‘There is a fear that this will set a precedent for HMRC and other government agencies [such as the collection of unpaid council tax].

“This is a dangerous route to begin to go down.These powers, if implemented, will affect families and individuals, as well as small businesses, up and down the country and not large multi-national businesses with armies of lawyers and accountants on hand to prevent it happening.”

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