If you worked in any of these countries, you could be due a Tax Refund

HMRC back in the spotlight

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“The only thing worse than being talked about is not being talked about.” - Oscar Wilde.

It's doubtful HMRC would agree with the sentiment; its had more than its fair share of coverage and lately and is back in the news today and not in a good way.

Earlier in the year we reported the problems with PAYE year-end reconciliations which are thought to be affecting 6 million people. We also reported on the NAO revelation of some 18 million cases dating back years which were still not closed. The Telegraph reports on 2 additional systematic problems which are affecting taxpayers.

The first relates to HMRC asking some taxpayers to repay refunds. Apparently HMRC did not take into account Benefits in Kind (BIKs) when originally calculating tax due and issuing the refund but to be frank here, this is down to the fact that HMRC doesn’t actually know whether a taxpayer has any BIKs until the employers report after the tax year has ended. This is simply how the system operates and the only ones who should be affected are those who received a BIK for the first time in 2009/10. HMRC's spokesman also said as much:

“Not sure about the logic about claiming we have made a mistake on employee benefits, this is how the tax system works, accountants would be well aware of this.......Where there is an underpayment it would be coded out if less than £2,000 so I am not sure about this suggestion about us asking for monies before Christmas.”

This problem should be remedied when HMRC move to real-time information gathering.

The second issue is slightly more pressing and relates to an error with HMRC's online system. Apparently any online requests between 1 Oct and 15 Nov for a repayment or for a reduction in payments on account have not been recorded properly. If you made such a request in this timeframe we recommend you log back on and see if the changes have been processed. If not, you may be in for a shock when you receive a letter from HMRC informing you about interest on your outstanding payment on account!