DRD rollout to more customers from April 2026

HM Revenue & Customs is rolling out Direct Recovery of Debts (DRD) to more customers from April 2026 onwards, after restarting the power in a controlled "test and learn" phase in September 2025¹. The government announced in the Spring Statement 2025 that HMRC would re-start the use of DRD for individuals and businesses who choose not to pay the tax they owe¹.

DRD allows HMRC to recover money owed by requiring banks and building societies to pay HMRC directly from a current or savings account, including a Cash Individual Savings Account, held by a customer in debt to HMRC¹. The power was used only 19 times in two years before being paused during the COVID-19 pandemic¹. In 2024 to 2025, HMRC brought in £858.9 billion in tax, of which about 90% was paid on time, with the rest becoming a debt¹.

The briefing sets out safeguards. HMRC says it will only consider DRD where tax and tax credits debts exceed £1,000, and will always leave a minimum of £5,000 in the customer's accounts¹. Every individual in debt, as opposed to a company or limited liability partnership, will receive a face-to-face visit from HMRC agents before their debt is considered for recovery through DRD; customers registered as a company or LLP will not usually receive such a visit¹. Action is only taken against those with established debts who have passed the timetable for appeals and have repeatedly ignored attempts at contact¹.

Customers have a 30-day window to object from when HMRC confirms it has put a hold on the relevant funds in their account; money stays within the bank and no funds are transferred until that period has passed, with decisions on objections made within 30 days¹. If HMRC rejects an objection, customers can appeal to a county court on specified grounds, including hardship and third-party rights¹. Where a customer is identified as needing extra support, DRD activity in progress will be stopped and they will be offered help; if they do not engage with the Extra Support Team, or the team decides support is no longer needed, normal debt recovery processes resume, which may include DRD¹. HMRC says statistics will be published on how often the power is used and how many appeals are raised¹.

Why it matters for households

From April 2026, more people who owe tax and have not paid it can have money taken directly from their current or savings accounts, including cash ISAs, rather than through other recovery routes¹. The change applies to individuals and businesses with established tax and tax credits debts above £1,000 who have not appealed in time and have not responded to HMRC contact¹. The £5,000 minimum balance means smaller balances are not swept, and the 30-day objection window runs from the point HMRC confirms a hold on the funds, during which the money remains in the bank¹. For individuals, a face-to-face visit comes first; companies and LLPs are not usually visited but are given multiple opportunities to resolve the debt before HMRC contacts their bank or building society¹. HMRC also operates Time to Pay payment plans, which it says see 9 in 10 agreements completed, and an extra support team for customers whose health or circumstances make contacting HMRC difficult¹.

What happens next

The rollout to more customers runs from April 2026 onwards¹. HMRC has not reported a closing date or a list of which customer groups will be brought in at each stage. The briefing was updated on 11 June 2026¹.