The FT reports that taxpayers, who have overpaid tax (as a result of PAYE coding errors) are now having to wait months for tax refunds due to them from HMRC.
It seems that the problems originally caused by computer systems being unable to match individuals with multiple sources of income have been exacerbated by stringent security checks.
Richard Mannion, national tax director at Smith & Williamson, is quoted:
"While there is clearly a need to carry out such checks, a delay of 10 weeks or more is excessive."
In one example, a taxpayer has been waiting over ten weeks for his repayment, even though he has paid tax since 1965, lived at the same address since 1995 and has submitted self-assessment returns since 1996.
'In this particular example HMRC ought to find it very easy to check its records to verify his claim,' says Mr Mannion. 'What I don't understand is why it takes ten weeks or more to do this.'"
Maybe, when taxpayers are asked by HMRC to pay overdue tax they should delay the payment so that they can carry out stringent security checks on HMRC?
With HMRC, sauce for the goose is evidently not sauce for the gander!
Tax does have to be taxing.
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On that basis it seems easier to get a few million by fraud than it is to obtain an honest entitlement.
ReplyDeleteWhat a stupid situation.
It seems like HMRC has made its own cash flow problem everyone elses. I feel sorry for the poor sods working for them.
Perhaps they need a Pacemaker not a Pacesetter?
I worked there for a number of years.
ReplyDeleteThe Samaritans should have a full time team attached to that woeful organisation.
"In this particular example HMRC ought to find it very easy to check its records to verify his claim,' says Mr Mannion. 'What I don't understand is why it takes ten weeks or more to do this"
ReplyDeleteerm... not exactly rocket science to work this one out!
More repayments + Less Staff + More complex & bureaucratic processes = ????
103 out of 103 = last as someone elsewhere has commented.
ReplyDeleteIs there a relationship between the continuing reduction in staff trying to handle an increasingly complex tax system some 2 - 3 years in arrears, a figure that varies depending whether you are clerical or boss and the plumetting results of their staff surveys over the same time.
without either standing up or knockin either side that article takes the piss. sounds like their own fault dont cry . hmrc maybe shit but some like that are just as bad
ReplyDelete20:48 is correct...
ReplyDeletethe FT article does takes the piss...
Firstly try finding a local tax office thats open...
Then see if it has a Complaints Manager!!!
What planet are you lot from?
ReplyDeleteDo you exist in a time warp?
It is HMRC taking the piss not the customer.
This is taxpayers money to which the customer is rightfully entitled to (right amount of tax at the right time?).
I would be more worried about finding this lot having my money to take the tax from before releasing the remainder to my bank account rather than trying to find a local office open with anyone in it that has a clue about the tax affairs of the customers.
Wait until the next cuts hit, will they end up re-employing those that have been made redundant/early retired/partially retired on short term contracts to handle the backlogs - you better believe it, unless of course they do away with their vetting procedures.
The reason for excessive delays is a belated response to massive fraud under the SA system of "Process now-Check later". When SA was first introduced it worked well for the most part, yes some people were on the fiddle but that is understandable. However, with the opening up of the EEC the UK saw an influx of less honest workers. The fraud was/is twofold. Firstly a group of people created false IDs (no National Insurance Number was originally needed to set up a SA record) and set up thousands of false self employment records. They then sent in tens of thousands of SA ITRs claiming refunds (usually about £1,000, but once they realised how easy it was the claims would be £10,000+). Refunds went out automatically and the money disappeared. An investigation would start in some cases, but of course the 'taxpayer' could not be traced! Thousands of individuals were doing the same. Most of the id's of these people seemed to be surnames of from Polish, Latvia, Nigeria etc.
ReplyDeleteThis went of for perhaps 5+ years despite protests from staff, who were ignored and were told by senior managers that the fraud was small and we would eventually recover the tax lost. I would estimate the total being £100 million plus.
Eventually Paul Gray and Dave Hartnett couldn't ignore it anymore and brought in stringent security checks. Unfortunately this caught the innocent as well as the guilty.
Interesting that Dave Hartnett is implicated again. Remember he was the sponsor of the Tax Credit system and is utterly responsible for the waste of billions of taxpayers money. What's that I hear? Knighthood next year?
I'm confused about how the delay in overpayment is linked to PAYE coding errors. Both Ken and the FT article mention it. Since the errors in coding caused very few overpayments most of them would have been caused by employers/employees, if they relate to PAYE. If the overpayments don't relate to PAYE then the coding errors are irrelevant.
ReplyDeleteAs for the example given:
- In one example, a taxpayer has been waiting over ten weeks for his repayment, even though he has paid tax since 1965 (how is this relevant?), lived at the same address since 1995 (how is this relevant?) and has submitted self-assessment returns since 1996 (so he has a source of income that is not PAYE).
The security checks they are referring to are on SA repayments. Again the link to coding errors is erroneous.
@11.04
ReplyDeleteI can categorically state from experience that the security checks are not SA only
In response to 11:04
ReplyDeleteThe point you may be missing about relevance is that here is someone who has been on the system paying tax for some 46 years, who has been living at the same address for 16 years and has actually submitted returns for SA for 15 years is likely to be a decent enough person who may well have been made reundant about 16 yeaars ago but didn't sit on his or her backside like most of the worse "customers" but became self employed rather than a sponger. The person has a damn sight more credibility than an economic migrant or immigrant wherever they are from.
10:32's comments are spot on, but the assessment of tax lost is way out, instead of millions, try billions, the theft or application of false NINO's goes back decades. I know 2 people whose identity and NINO was beeing falsely used as far back as the 80's.
Try having a look at how much was lost with the earlier construction certificate schemes.
Or if you want a real laugh have a look at what you can claim/write off against CT including overseas development costs - and who goes all the way to e.g. Africa to check - Dave Hartnett?
Dont panic everybody. HMRC has the answer to solve all of these problems. Along with its Customer Centric Business Strategy (????) it has now released its People Strategy (????!!!!!????) For those that work in HMRC you'll need to check out 20/20 in this month's PULSE magazine.
ReplyDeleteThe People Strategy is called Our People Priorities (I shit you not) and lists the three things that HMRC will concentrate on so its staff can provide the best possible service to its customers (I shit you not again)
The three areas are:
Performance (currently shite)
Professionalism (currently shite due to management direction and interference.)
Leadership (currently very fooking shite)
No details has been supplied about exactly how HMRC will improve these three things and no indication is given about how HMRC intends to go about doing it but who cares, they've got a strategy!!!
Final comedy moment on this is in the drivel that sits underneath this thing. Apparently, one of the key themes in this is that HMRC, wait for it, probably best if you read this sitting down...
"HMRC will not tolerate mediocrity in its leaders..."
Please feel free to add your own jokes in reply to that...
Re 17:41 - The probable reason for the delay is each case needs to be reviewed and released individually, so if there are only say 20 people doing it (no doubt even less shortly!)and there are 100,000 cases to review.....
ReplyDeleteI take your point about the volume of fraud though. There has been sucess with MITC fraud, but horse and bolted springs to mind. And how do you police a system which is open to attack every day by thousands of criminals when you only have finite resources? (posted by Mr 10.32)
In response to 14 April 2011 17:41
ReplyDeleteI didn't miss anything. The person whose record it is may be genuine but as you have said yourself - "I know 2 people whose identity and NINO was being falsely used as far back as the 80's."