HMRC is facing major embarrassment after a leaked memo has revealed that those who under- or overpaid tax in 2013/14 may have once again received an incorrect tax bill.
On 8 October it emerged that an email had been sent to accountants and staff that read: “We currently do not know the scale of the issue, but some large employers are involved, so several thousands of employees may be affected”.
Recipients of the email were instructed to tell taxpayers not to repay any underpayments and not to cash any cheques reimbursing them until the errors had been rectified. HMRC has also stopped sending repayments until the issue is resolved.
How does this happen?
Every year, around 5 million taxpayers end up paying the wrong amount of PAYE. This happens for various reasons – for instance if they are on the wrong tax code, may have had a pay increase, moved jobs or taken on a second job.
HMRC has admitted that a computer flaw, which duplicates entries, is a major cause of the blunder. But it refuses to take all the blame, pointing out that employers are still submitting incorrect employee information – something the government was hoping to avoid through the new £270 million ‘Real Time Information’ (RTI) programme.
If you receive a letter of demand or a reimbursement cheque from HMRC, you can safely put it aside without paying anything back or cashing the cheque just yet. You might end up causing even more complications for yourself. Rather let a 1st Contact Tax Refund consultant investigate on your behalf and find out exactly what the amount is that you owe or are owed.