In keeping with the season, the FT reports that HMRC is snowed under with claims for tax repayments from companies.
Seemingly, businesses are waiting twice as long for corporation tax rebates from HMRC than they were a year ago.
Waiting times of a month (in comparison with 14 days last year) are now common.
The problem arises because the recession has increased the number of claims for rebates, which HMRC simply doesn't have the resources to handle in a timely manner.
Self assessment rebates for individuals are processed automatically. However, business rebates are processed manually.
Doubtless there will be those who argue (as they have done before) that if returns were input by businesses earlier in the year, the backlog would be lessened.
That is not unreasonable, up to a point. However, it should be remembered that the businesses are trying to drum up business and continue in operations; their time and energy are focused on that. HMRC's role is to make tax administration/payment etc simple, efficient and as least time consuming as possible.
Tax does have to be taxing.
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A month is nothing, I feel sorry for the poor small businesses that are awaiting for a repayment on their PAYE. Most of them take at least 2 months, often longer. It might mean the difference between them staying afloat or going under.
ReplyDeleteWho would have thought businesses would have overpaid their taxes and seek to reclaim a repayment when the economy declines.
ReplyDeleteS. Arcastic
I expect the required 'resources' are too busy trying to sort out the new computer system (What, another one?) that keeps issuing wrong tax codes to all and sundry.
ReplyDelete"HMRC's role is to make tax administration/payment etc simple, efficient and as least time consuming as possible."
ReplyDeleteErrrr... you could have fooled me!!!
..but it IS simple and efficient!!
ReplyDeleteThe New Penalties System for instance was brought in in response to requests from the trade, it went through months of extensive consultations with interested bodies, it is super streamlined, with the absolute minimum of bureaucracy and paperwork and customers love it because it is fair and transparent and encourages them to behave in the right manner whilst coming down hard on those who choose not to co-operate.
Everything in the HMRC garden is rosy and I can't understand everyone on this blogsite who is always moaning.
Grant said...
ReplyDeleteI expect the required 'resources' are too busy trying to sort out the new computer system (What, another one?) that keeps issuing wrong tax codes to all and sundry.
Grant you are wrong, totally separate departments. Those dealing with employers PAYE schemes have no involvement and know nothing of these coding matters. Don't make the mistake of thinking one department has any idea what the other does!
This is all caused by many other factors, mainly CENTRALISATION and reduction in staff, the staff going of course are all the ones with experience & expertise, either because they have been encouraged to take early retirement and want to get to hell out, or because the work they have they expertise in has moved to Longbenton, Newcastle. I think everything is ending up there. Government is soon to announce huge drop in unemployment in Newcastle.