HMRC writes off £13bn in tax as businesses collapse under Labour

HMRC wrote off £9.8 billion in irrecoverable tax debts in 2025-26, with total tax debt losses reaching £12.9 billion, more than triple pre-pandemic levels, according to a National Audit Office report that attributed the increase partly to rising company liquidations and personal bankruptcies, as business insolvencies climbed 39% since 2019-20 and HMRC's successful winding-up petitions surged 185% between 2022-23 and 2025-26 amid increased enforcement activity and continued financial pressure on businesses from higher borrowing, employment and operating costs.

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