HM Revenue and Customs (HMRC) has a £900m discrepancy between debt recorded on its mainframe accounting system and a separate trader register.

The missing millions result from inhibitors on certain debts on the mainframe, preventing their transfer to the register, which is supposed to be updated daily, according to a National Audit Office (NAO) report.

Most of the inhibited debt relates to missing traders and cases under appeal and would have been suspended once it had been transferred to the register.

‘The department has been unable to give a detailed explanation and breakdown for all debt falling into this category,’ says the NAO report.

The department estimates that £865m of the £900m relates to the missing traders and cases under appeal and is not immediately recoverable.

The NAO says missing debt was identified in 2002 but that HMRC did not start to address the problem until 2004. Resolving the issue ‘took longer than expected’ because the department decided to use limited IT resources elsewhere.

HMRC expects a full reconciliation between the two systems to be completed next month.

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