Friday 29 January 2010

HMRC's Coding Enigma II



The confusion over HMRC's erroneous tax codes being sent out this year continues to rumble on.

Yesterday an HMRC spokesman said:

"It's a hangover from the old system.

Before we had five or six systems sending out tax codes, but because of last year's upgrade we now have one. The new system is basically picking up duplicates from the old one and flushing them out.

The new system is working as it should, and we're confident that it will not happen again in future
."

Today, on their own website, HMRC (having been stung into action by the media) now say:

"The transition to the new system has, however brought to light discrepancies in our existing records and this is resulting in a number of incorrect notices being issued.

The vast majority of notices will be correct but there will be cases where, because the data carried over from our old systems does not match employers' data, some people receive an incorrect coding notice or more than one coding notice for the same employment because of these discrepancies.

This is a transitional issue caused by data mismatches, rather than an IT issue and will be resolved once we have cleared these from the system
."

So it's not "duplicates", but "discrepancies in existing records". It most certainly isn't an "IT issue"!

I am having trouble understanding this, if there were discrepancies in existing records wouldn't that mean that HMRC would have sent out incorrect coding notices in previous years then?

I wonder what the reason will be next week?

Tax does have to be taxing.

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9 comments:

  1. I was confused by the explanation as well. The only thing I can think they mean is:
    If you had two different records on two databases,both showing all the personal allowance, in the past the system would not have issued out a code (employers just increase everyones code in line with P9 instructions). If the employee had left one of them and this was not updated on that database no one would know there was a second record.

    Now that effectively there is a single database it is changing the code on one of these records and allocating personal allowances. Without human input it is picking the wrong one in some cases.

    I find it hard to believe there were enough records in that position to create this many new codes.

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  2. absolute rubbish with the old system what you just said you could see on the old system by looking under a certain function just how many records /employments pensions etc someone had

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  3. Is this the guilty woman?

    http://www.publicservice.co.uk/feature_story.asp?id=13555

    "Despite the challenges there are reasons to be cheerful, Strathie insists, pointing to successes such as the modernisation of the PAYE system, migrating 57 million accounts onto a single database and creating 44 million unique customer records;"

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  4. Where is Dave when you need him?

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  5. Seems to be a habit

    http://business.timesonline.co.uk/tol/business/economics/article6722456.ece

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  6. This is a transitional issue caused by data mismatches, rather than an IT issue and will be resolved once we have cleared these from the system."

    So it's not "duplicates", but "discrepancies in existing records". It most certainly isn't an "IT issue"!


    Nothing to do then with stranded employees on PAYE schemes; nothing to do with the "embargo" on Transfers, mergers and successions and nothing to to with the fact that Employer's sections seem to do more walkabouts than Crocodile Dundee on speed?

    Hmmm okay so nothing to do with IT issues then, just incompetency at the top!

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  7. IT issue: Garbage In Garbage Out

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  8. The BBC has caught up:
    http://news.bbc.co.uk/1/hi/programmes/moneybox/8500074.stm

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  9. There weren't a number of systems issuing codes. There was only one, but subdivided into six mainframes. The sort of screw-ups with benefits we're seeing now were all but impossible under the old system (unless operator error was involved).

    What has really happened is that in previous years - in order to deal with backlogs - annual 'open case' reviews were left undone. That led to the summary screens of under- or over-payments showing the wrong amounts.

    When this new system was set up, it simply copied over what was on the summary screens, and then automatically assumed that underpayments from, say, five years ago, had never been collected and has been shoving them in people's PAYE codes for 2010/11. In the vast majority of these cases, the underpayments were either collected in the interim via PAYE or Self Assessment, or were never due in the first place.

    In other words, HMRC are reaping the whirlwind of leaving crucial jobs undone in previous years because they didn't have enough staff at the right grades to deal with them.

    ReplyDelete