HMRC Is Shite

HMRC Is Shite
Dedicated to the taxpayers of Britain, and the employees of Her Majesty's Revenue and Customs (HMRC), who have to endure the monumental shambles that is HMRC.

Wednesday, 30 October 2013

Tax Coding Errors

Incorrect tax codes mean that over one in three taxpayers who receive employment benefits in kind could be in danger of paying the wrong amount of tax, according to UHY Hacker Young.

The firm's analysis of tax codes sent to clients revealed that around 37% would have resulted in people paying the incorrect amount of tax.

Whilst it is up to the individual taxpayer to check his/her tax code and statement, human nature and the fact that most people are clueless about how the tax system works means that many people take their tax codes and statements at face value. This in turn results in over/underpayments of tax.

Roy Maugham, Partner at UHY Hacker Young's London office, said:
Mistakes most frequently occur when someone has several sources of income, for example income from an investment as well as a salary and benefits from their employer, or where they have received a large one-off sum such as a dividend payment.

HMRC really needs to make more of an effort to eliminate these errors as generally people trust its calculations and assume that they are paying the correct amount of tax.

If taxpayers do spot a mistake, it is now an even bigger headache to sort out because HMRC has made it harder to challenge unfair tax bills.”
One UHY Hacker Young office saw errors for 20 different taxpayers in just one week relating to benefits provided by employers, such as company cars and private health cover (usually set out on a P11D form).

In most of these cases the code sent by HMRC completely omitted to account for the tax due on the benefits.

The lesson being, check your tax code and tax bill!

Tax does have to be taxing.

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  1. To be honest, it would probably be better for all concerned if the allocation of tax codes reverted to the employer's payroll department or taxpayers accountant as HMRC just get it wrong anyway.

  2. Many codes issued now are automatic, based on information supplied by the employer or submission of a tax return. Submitted P11D's or P46 car forms will auto generate an issue of a code. RTI info submitted by employer if incorrect or differing from what's on record can initiate an auto issue or set up a duplicate record and incorrect code.
    Many of the fuck ups are not HMRC employees errors but stem from employers being slapdash with submitted info.
    I'm not trying to say errors are not made we are only human but if I had a pound for sorting out employer cock ups that have been made I could be a rich man

  3. @ 22:49 - You won't be popular round here. Reality is the last thing we want. Its all the fault HMRC staff. Nobody else ever gets it wrong or contirbutes to these errors.