Tax debt rises to £43.8bn as HMRC winding up petitions reach year high
Tax debt rises to £43.8bn as HMRC winding up petitions reach year high
New figures released today show that tax debt reached £43.8 billion at the end of September 2025, a slight rise vs the end of June 2025 when tax debt levels stood at £42.6bn.
Meanwhile, HMRC winding up petitions reached a year high with 423 petitions filed in October, the highest monthly level since October 2024.
While tax debt as a proportion of total tax receipts fell from 5.2% in 2023-24 to 5.0% in 2024-25, this still represents nearly double the pre-pandemic rate.
HMRC says it is determined to reduce this further but levels remain stubbornly high.
Commenting on the figures, Dawn Register, a tax dispute resolution partner at BDO said:
"By any measure, £43.8bn is an enormous amount of tax that remains uncollected. At last year’s Budget and this year’s Spring Statement, the Government pledged a further £630 million to boost HMRC’s ability to recover debt including an extra 2,400 debt management staff. While total tax debt may down £1bn since last year, the Chancellor will be expecting to see a bigger falls in future to give a better return on her investment.
“However, there are some signs that HMRC is getting tougher on businesses that are unable or unwilling to settle their tax debts. In October, we saw the highest level of winding up petitions filed with the courts so far this year. Feasibly we could see these levels rise over the coming 12 months.
"HMRC needs to strike the right balance between supporting businesses and individuals in genuine financial difficulty through Time to Pay arrangements, while being more assertive with those who can afford to pay but choose not to. These latest figures suggest there's still significant room for HMRC to improve its debt collection effectiveness.”
ENDS
Note to editors
BDO surveyed 200 individuals with a connection to the UK including wealth creators and heirs/spouses with more than £20m in investable assets or more than £50m in total assets.
The organisations we work with are Britain’s economic engine; entrepreneurially-spirited, high-growth businesses that fuel the economy.
We understand the ambitions and entrepreneurial mindset of those we work with and have the global reach, integrity and expertise to help people and businesses succeed.
BDO LLP
BDO LLP operates in 18 offices across the UK, employing 8,000 people offering tax, audit and assurance, and a range of advisory services. BDO LLP is the UK member firm of the BDO international network.
BDO’s global network
The BDO global network provides business advisory services in 166 countries and territories, with more than 115,000 people working out of 1,776 offices worldwide. It has revenues of US$14bn.
Contacts
Frank Shepherd
Senior PR Manager
BDO
frank.x.shepherd@bdo.co.uk
Meanwhile, HMRC winding up petitions reached a year high with 423 petitions filed in October, the highest monthly level since October 2024.
While tax debt as a proportion of total tax receipts fell from 5.2% in 2023-24 to 5.0% in 2024-25, this still represents nearly double the pre-pandemic rate.
HMRC says it is determined to reduce this further but levels remain stubbornly high.
Commenting on the figures, Dawn Register, a tax dispute resolution partner at BDO said:
"By any measure, £43.8bn is an enormous amount of tax that remains uncollected. At last year’s Budget and this year’s Spring Statement, the Government pledged a further £630 million to boost HMRC’s ability to recover debt including an extra 2,400 debt management staff. While total tax debt may down £1bn since last year, the Chancellor will be expecting to see a bigger falls in future to give a better return on her investment.
“However, there are some signs that HMRC is getting tougher on businesses that are unable or unwilling to settle their tax debts. In October, we saw the highest level of winding up petitions filed with the courts so far this year. Feasibly we could see these levels rise over the coming 12 months.
"HMRC needs to strike the right balance between supporting businesses and individuals in genuine financial difficulty through Time to Pay arrangements, while being more assertive with those who can afford to pay but choose not to. These latest figures suggest there's still significant room for HMRC to improve its debt collection effectiveness.”
ENDS
Note to editors
BDO surveyed 200 individuals with a connection to the UK including wealth creators and heirs/spouses with more than £20m in investable assets or more than £50m in total assets.
The organisations we work with are Britain’s economic engine; entrepreneurially-spirited, high-growth businesses that fuel the economy.
We understand the ambitions and entrepreneurial mindset of those we work with and have the global reach, integrity and expertise to help people and businesses succeed.
BDO LLP
BDO LLP operates in 18 offices across the UK, employing 8,000 people offering tax, audit and assurance, and a range of advisory services. BDO LLP is the UK member firm of the BDO international network.
BDO’s global network
The BDO global network provides business advisory services in 166 countries and territories, with more than 115,000 people working out of 1,776 offices worldwide. It has revenues of US$14bn.
Contacts
Frank Shepherd
Senior PR Manager
BDO
frank.x.shepherd@bdo.co.uk