MSE News: Tax chaos Q&A: How to fight HMRC demands

Former_MSE_Guy

This is the discussion thread for the following MSE News Story:

"The Revenue today begun reclaiming cash from 1.4m but it won't fight complaints where it's failed to follow its rules ..."

Read the full story:
Tax chaos Q&A: How to fight HMRC demands

DarkConvict

Oh I do dislike the tax system. Im sure it could be made so much similar, maybe something worth me researching into as part of my MRes project.

I was miscalculated tax last year due to my employer on my university placement. When i joined I had to fill in the P46/45 and it asked if this was my first job, do i get an employment pension etc. Well i stated I had a child pension whilst at university only but they had me mark the box to say basically none of the above. Which to the wording of the form was correct!

This is where the lack of financial planning comes in, as i ended up with 2 tax free codes on each income, and I assume you only had 1 tax code and they must all match, little did I know. After a few days digging this was all resolved and I worked out how I should have been taxed. I rung up the HMRC and whilst I got a pleasant man to start with once he found out i was undertaxed he become unpleasant like a debt collector, and stated the form means do you have any other taxable income to of which I replied yes I do, I knew that, but that is not what your form has asked for, if it did I would have told you.

End story, I was undertaxed ~£1000 as expected from a double tax free allowance, I challenged it based on the form didn't state child pension, and my employer was informed about the income, they originally held up the HMRC stance of regardless of blame you will pay us next year. I continued to dispute it by letter/telephone and whilst it has not been resolved (no final written response) I'm now waiting for HMRC to get back in touch on their decision. If they have to increase the tax code then so be it, but they better improve their forms in future to just state any taxable income affected by a tax code must be declared on the form.

If they don't teach children how the system works, how the hell are they meant to know when it has gone wrong... even more so given my mom's tax got into a mess when she got the local HMRC office to fill it in! If they don't understand it, I don't see who could..

alunharford

As a computer programmer, I have to ask how on earth somebody can produce a system so utterly flawed. Did nobody bother to do any of the calculations by hand to see if it works for one person?

KCS1503

Where people have to complete an annual tax return would you not expect that any errors in PAYE deductions which have arisen would have been picked up through the calculations on the figures provided in the return. Does that mean that people in that category are therefore unlikely to be in either the underpaid or overpaid category?

If they were to have found to have over or under paid and they used the HMRC tax calculator through the file online filing process that would suggest that the application behind that calculation is flawed too.

Has anyone received a notice yet? If so what the wording?

I seem to recall that "tax doesn't have to be taxing...."

Thanks,
Kevin S.

gt94sss2

KCS1503 wrote: »

Where people have to complete an annual tax return would you not expect that any errors in PAYE deductions which have arisen would have been picked up through the calculations on the figures provided in the return. Does that mean that people in that category are therefore unlikely to be in either the underpaid or overpaid category?

Yes, the errors identified will be for people who haven't filled in tax returns.

Has anyone received a notice yet? If so what the wording?

It seems HMRC are issuing P800 tax calculations to those affected.

Regards
Sunil

john59_2

JUST COME ACROSS THIS

http://www.thisismoney.co.uk/tax/income/article.html?in_article_id=513886&in_page_id=77

I dont understand it so no Qs please.

What are they going to throw at us next I wonder

john59_2

And here.
http://www.thisismoney.co.uk/news/article.html?in_article_id=513925&in_page_id=2

Make of it what you wish but it all smacks of lunatics taking over the asylum to me

gt94sss2

alunharford wrote: »

As a computer programmer, I have to ask how on earth somebody can produce a system so utterly flawed. Did nobody bother to do any of the calculations by hand to see if it works for one person?

Its a new computer program which has found all the errors. Its when their staff were doing it manually that seems to have caused the errors!

Regards
Sunil

DarkConvict

I'm a software engineer, so can say that the problem more likely lies in the actual tax system not the computer program. The program sure can cause issues but if the spec is wrong, the programmers do not understand the problem, the system will not magically fix anything.

Mahmood_Reza

At the risk of being a lone voice on this issue I have a littke sympathy with the tax office (HMRC). They and their computer systems obviously should take their share of responsibility for the obvious stress and anxiety that is being caused by these errors and the timeliness of discovering them, however in the interests of balance it is not all their fault. For PAYE to operate successfully requires 'correct' forms & information to be completed & submitted by employer & employee alike. For example, when people change jobs, take on part time work, P45s, P46s etc are not all necessarily correctly completed (if at all) and thus problems will be created.
There are many reasons for these errors ocurring, including Employers not being fully aware of the rules and procedures - HMRC take the (simple) view that ignorance is no excuse - their view being that all the information is out there & people have access to free suppport and guidance etc etc, it is no suprise that errors will occur.
In general terms I am not a big fan of HMRCs attitude, approach and deteriorating service standards but it is not all one sided.

alunharford

gt94sss2 wrote: »

Its a new computer program which has found all the errors. Its when their staff were doing it manually that seems to have caused the errors!

The reports I've seen in the press suggest that moving from one computer system to another highlighted a multi-billion pound position break between their income tax database and their NI database.

I'd like to know if that's true though...