HMRC told us that it has a significant debt balance, about £27 billion, which is not in any payment arrangement and has increased mainly as a result of policy decisions to allow taxpayers to defer their tax payments. HMRC aims to get as much of the balance as it can into “managed payment arrangements” and to minimise its exposure to losses through insolvencies. HMRC said its intention was to allow taxpayers as much time as they need to pay their tax, and to try to avoid bankruptcy or insolvency except “as a very last resort on non-viable taxpayers”. HMRC highlighted the very high compliance rates, about 90%, of its ‘time-to-pay’ instalment arrangements to recover tax debts, which allow it to collect the vast bulk of outstanding taxes and to minimise the number of insolvencies.52 In the early stages of the COVID-19 lockdown, HMRC had suspended all of its debt recovery actions to recognise the struggles faced by taxpayers as a result of the pandemic. The Department told us that more recently it has restarted it debt recovery operations, targeting businesses that its data suggest ought to be able to pay their tax liabilities.53