HMRC's £5.5BN Tax Grab

In a court victory last week HMRC been given the go-ahead to demand £5.5BN from taxpayers, before they have chance to appeal.

HMRC can demand that individuals pay tax within 90 days, with added penalties and charges, if they are suspected of abusing legitimate tax reliefs. In the event a court later decides that HMRC's calculations were wrong, the money is paid back.

Richard Morley, a partner at BDO, is quoted by the Telegraph:

"Just as HMRC is about to be given the power to raid people's bank accounts, they have been given the go-ahead to pursue billions in tax it thinks people owe."

A recipe for disaster, as miscalculations have already been detected in the 10,000 "accelerated payment notices" sent to taxpayers so far. According to Mr Morley, clients have been sent letters in cases where the calculations were incorrect by tens of thousands of pounds.

HMRC will now be sending an expected 54,000 letters to individuals it also suspects of avoiding tax, demanding that they pay up in within three months, in a bid to collect the extra money.

"We expect to complete the issue of around 64,000 tax notices by the end of 2016, bringing forward £5.5bn in payments for the Exchequer by March 2020."

Let's see how this goes then!

Tax does have to be taxing.

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