Five million British taxpayers could face financial worry as HMRC admits to tax blunder

HMRC admits to tax blunder - RTI system | Oct 2014 | Bradleys

Date09 Oct 2014
Posted ByAdmin

According to HMRC whistle-blowers, over 5 million British workers might face financial worry as their tax bills have been miscalculated for the second time.

It was around 4 months ago, in June, HMRC revealed that 5.5 million British taxpayers either paid too much or too little tax in the year to April 2014. Subsequently, HMRC amended their mistake by sending refunds or demands for extra money, but it has now been revealed that some mistakes were repeated during the process.

When contacted, HMRC estimated that less than 100,000 people would suffer because of the new mistake, but admitted that they were still not sure about the extent of the problem. According to the Daily Telegraph, who received a leaked email about HMRCs problems, HMRC has stopped sending refunds till the problem is solved.

The email, sent to accountants and senior HMRC staff, said, ‘We are urgently investigating these cases and will look to resolve the matter in the next six to eight weeks. We currently do not know the scale of the issue but some large employers are involved, so several thousands of employees may be affected.’

It was claimed that HMRC’s £270m Real Time Information (RTI) system, introduced in 2012 and meant to reduce errors, could be behind the problems.

The system is not fit for purpose, it's inherently flawed and routinely produces errors that cause a huge mess for families and employers,’ said one of the whistle-blowers.

In defence, a spokesman for the HMRC added: ‘The majority of the errors have happened because an employer failed to make a final payment statement for the 2013/14 tax year meaning our records were incomplete despite reminders that these submissions had to be made. We are sorry this has happened and we aim to issue corrected calculations in the next few weeks.