HMRC asking me to repay from a rebate

Jeremy535897

What I don't understand  is why FTR is described as a nominee, but not described as a tax adviser. You need to make clear to HMRC, in writing, that you were unaware that FTR were filing tax returns on your behalf, and had not approved them. I suggest you do this in the letter I mentioned concerning their removal as tax agents.

You say you have "always been PAYE". Why are you completing self assessment tax returns, or did they start with FTR?

GrumpyDil

So FTR have not declared themselves as your tax adviser but merely given their bank details to receive the refund as OP's nominee. As it sounds like they may have done this for quite a number of cases it will likely be very easy for HMRC to track them all by looking for payments made to that account. 

dixon2094

Jeremy535897 said:

What I don't understand  is why FTR is described as a nominee, but not described as a tax adviser. You need to make clear to HMRC, in writing, that you were unaware that FTR were filing tax returns on your behalf, and had not approved them. I suggest you do this in the letter I mentioned concerning their removal as tax agents.

You say you have "always been PAYE". Why are you completing self assessment tax returns, or did they start with FTR?

No - I was aware they were filing on my behalf. They said they could get me a rebate based on my previous 3 years' tax payments. I gave them access to my GG, etc. However, it turns out they had amended previous tax returns in relation to EIS, which I was unaware of, and wasn't even eligible in the first place. That is what they did, but only told me "I can get a rebate based on previous years' tax payments". They never mentioned EIS once to me.

dixon2094

GrumpyDil said:

So FTR have not declared themselves as your tax adviser but merely given their bank details to receive the refund as OP's nominee. As it sounds like they may have done this for quite a number of cases it will likely be very easy for HMRC to track them all by looking for payments made to that account. 

Yes - that's exactly right. There's a load of people who live near me who are getting these letters from HMRC now.

dixon2094

I've been advised to submit a SAR to HMRC. It may seem silly me asking, but I just want to ensure I do this right...

So, do I go to https://www.tax.service.gov.uk/shortforms/form/DPU_SAR and fill this out?
Selecting "Other" in Part B, and then in Part C mention "I would like all data about my income tax account for the last 6 years"?

Once this has information been received, I've been informed I have a case to decipher and understand whether they knew about FTR's dealings prior to paying out. I understand the rebate was applied for/paid out June 2020.

Here is a snippet from the initial letter I received: https://i.postimg.cc/HnVcGy6t/Screenshot-2021-06-10-at-12-59-56-pm.png

I got the same letter for 17/18, 18/19, and 19/20 - all in one go.

They mention it's a "compliance check". Does this change things at all?

Jeremy535897

See https://www.gov.uk/tax-compliance-checks
See also https://www.legislation.gov.uk/ukpga/1970/9/section/9A
I would recommend that you get proper professional advice from someone specialising in tax enquiries.

csgohan4

Sounds like a scam and you saw the money and took the bait it seems. Did you genuinely have tax rebates due if you did, then ignore my post.  Did you not see that 66% charge is a bit high?

it's like the companies doing your uniform and other tax rebates for you, for a cost, when you can do it yourself on the gateway. 

dixon2094

This was my recent email to HMRC after submitting the SAR and LBA to FTR, and the SAR to HMRC via their website:

"Thanks for your email. I've sought legal advice with the possibility of a case against FTR. I've been instructed, and sent this morning, a Subject Access Request letter and a Letter Before Action, requesting repayment of the monies they received on my behalf, due to providing a service not "fit for purpose", based on Consumer Rights Act 2015, for fraudulently submitting a rebate, after misinforming myself of the scheme details. FTR have 30 days to respond to the SAR and 14 days to respond to the LBA, and if no response is provided, then I will take further action via small claims court. With that being said, is there a way in which interest can be stopped/payments postponed until I hear the result of this from FTR. I will then be in a position to understand how much money I have and how I can pay? Anything else you can suggest would be appreciated."

This was HMRC's response this morning:

"The tax has been postponed pending the outcome of your appeal. My letter of 9 June 2021 was my decision about your appeal but this is not the end of the matter. You can ask for an independent review and a hearing at Tribunal which was explained in my letter. The appeal will remain open and the tax postponed whilst you go through this process; or withdraw your appeal. I have removed Fast Tax Rebates from your record as instructed."

Still no response from FTR.

Jeremy535897

My understanding of the position is as follows:

1. You appointed FTR as your tax agent, on the basis that they somehow had a legal way of obtaining a refund of thousands of pounds in tax, which was not correctly explained to you. (If it is possible to achieve this, why isn't everyone doing it?)
2. FTR made claims in respect of EIS investments that you did not make, even though they knew, or should have known, that HMRC would expect to see evidence in the form of an EIS 3.
3. HMRC now know that the investments were not made, and want repayment of the incorrect refunds.

It seems to me that HMRC are being very forbearing. The legal position is that they are owed £3,000 or so in tax by you. The fact that FTR were your agents, and received the repayment as your nominee, is a matter between you and FTR (although there is the odd point that they did not check the box that said they were your tax adviser, I don't think it helps). Based on what you have said, I am not clear what the grounds are for postponing the repayment of the tax. The longer it is postponed, the more interest (currently 2.6% per annum) will be added.

Your seeking of redress from FTR is irrelevant to HMRC, except that you are using it as evidence that you have been careless rather than deliberately making false claims, which should help towards mitigating any penalty due on top of the tax and interest. That is the area where professional advice may assist.

antonic

dixon2094 said:

This was my recent email to HMRC after submitting the SAR and LBA to FTR, and the SAR to HMRC via their website:

"Thanks for your email. I've sought legal advice with the possibility of a case against FTR. I've been instructed, and sent this morning, a Subject Access Request letter and a Letter Before Action, requesting repayment of the monies they received on my behalf, due to providing a service not "fit for purpose", based on Consumer Rights Act 2015, for fraudulently submitting a rebate, after misinforming myself of the scheme details. FTR have 30 days to respond to the SAR and 14 days to respond to the LBA, and if no response is provided, then I will take further action via small claims court. With that being said, is there a way in which interest can be stopped/payments postponed until I hear the result of this from FTR. I will then be in a position to understand how much money I have and how I can pay? Anything else you can suggest would be appreciated."

This was HMRC's response this morning:

"The tax has been postponed pending the outcome of your appeal. My letter of 9 June 2021 was my decision about your appeal but this is not the end of the matter. You can ask for an independent review and a hearing at Tribunal which was explained in my letter. The appeal will remain open and the tax postponed whilst you go through this process; or withdraw your appeal. I have removed Fast Tax Rebates from your record as instructed."

Still no response from FTR.

Jeremy535897 said:

My understanding of the position is as follows:

1. You appointed FTR as your tax agent, on the basis that they somehow had a legal way of obtaining a refund of thousands of pounds in tax, which was not correctly explained to you. (If it is possible to achieve this, why isn't everyone doing it?)
2. FTR made claims in respect of EIS investments that you did not make, even though they knew, or should have known, that HMRC would expect to see evidence in the form of an EIS 3.
3. HMRC now know that the investments were not made, and want repayment of the incorrect refunds.

It seems to me that HMRC are being very forbearing. The legal position is that they are owed £3,000 or so in tax by you. The fact that FTR were your agents, and received the repayment as your nominee, is a matter between you and FTR (although there is the odd point that they did not check the box that said they were your tax adviser, I don't think it helps). Based on what you have said, I am not clear what the grounds are for postponing the repayment of the tax. The longer it is postponed, the more interest (currently 2.6% per annum) will be added.

Your seeking of redress from FTR is irrelevant to HMRC, except that you are using it as evidence that you have been careless rather than deliberately making false claims, which should help towards mitigating any penalty due on top of the tax and interest. That is the area where professional advice may assist.

Although HMRC have decided to suspend all collection action on this debt , may I suggest that you start to make voluntary payments to HMRC to reduce the outstanding balance ( and any future interest charges).
IF HMRC do decide that you do not have to pay this debt , the amounts paid will be refunded to you - also HMRC will see that you want to deal with this in a responsible manner.