In a leaked email, HMRC has admitted that over 5 million taxpayers may have had their liabilities calculated incorrectly. Despite subsequent adjustments and assessments, and in many cases refunds issued, they may still have paid the wrong amount.
As an interim measure HMRC have stopped sending tax repayments until the crisis is resolved.
Some months ago, the Revenue admitted it had collected the wrong amount of tax from more than five million people in the 12 months to April 2014, and has subsequently been contacting taxpayers to explain how it intended to collect arrears or issue repayments.
Despite HMRC assurances that less than 100,000 people were likely to have been affected, they were unable to be specific with insiders suggesting the figure will run into many millions.
This has occurred despite the expensive introduction of RTI, where employers report monthly or weekly to HMRC on amounts deducted from employees, and is a significant embarrassment to the Revenue at a time when they are being increasingly criticised for ‘over aggressive’ treatment of innocent taxpayers and further undermines the public’s confidence in HMRC.
A spokesman for HMRC said the incorrect letters were “not demands” but merely tax summaries, “like the annual ones your credit card or bank sends you showing your total transactions across the year”.
“No one has been asked to hand a penny over in tax because of this,” the spokesman added.
“We are sorry this has happened and we aim to issue corrected calculations in the next few weeks.”
Unfortunately mistakes do happen, and this just goes to emphasise that taxpayers should not simply accept what they are told by HMRC. Expert professional advice should always be sought on all aspect of taxation, and at Burgis & Bullock our experienced team are available to assist in all aspects of personal and business taxes, as well as dealing with HMRC enquiries and disputes. Contact your local office on our local rate number 0845 177 5500, or using our on line contact form.