Tax Rebate Companies

deihpos

I'm just putting this in because a number of people I work with have claimed a tax rebated through taxrebatestoday.co.uk. They have managed to claim back large amounts around 4k each. For context, we work in an office, we have hybrid working and can work from home 2-3 days a week but don't have to. We don't have a uniform but should dress smart-casual. I'm failing to understand how people are able to receive such big rebates, surely we are paying the correct tax anyway? I've looked on HMRC to claim directly but don't understand how I'd do this without lying. Is this legal and will they be asked to repay the money they've received?

eskbanker

Steer well clear of ambulance-chasers like that!

https://www.moneysavingexpert.com/news/2022/07/beware-third-party-hmrc-tax-rebate-firms/

Feel free to find out and share more detail about exactly on what basis your colleagues obtained rebates, but it all sounds very fishy - if you're genuinely due a rebate then you should be able to secure this yourself, but if it's some nonsense about uniforms, home working or whatever then it's either highly questionable and/or unlikely to realise anything like £4K....

molerat

deihpos said:

I've looked on HMRC to claim directly but don't understand how I'd do this without lying. Is this legal and will they be asked to repay the money they've received?

That's how they work.  HMRC will issue a refund based on the submission with no questions asked. When they reconcile the year they will find out the claim wasn't valid and will claw it back.  Of course the claim firm have had their cut and you won't be getting that back.

deihpos

molerat said:

deihpos said:

I've looked on HMRC to claim directly but don't understand how I'd do this without lying. Is this legal and will they be asked to repay the money they've received?

That's how they work.  HMRC will issue a refund based on the submission with no questions asked. When they reconcile the year they will find out the claim wasn't valid and will claw it back.  Of course the claim firm have had their cut and you won't be getting that back.

I thought that, I knew it sounded too good to be true. There are a lot of people in my office doing it. Do HMRC contact them to provide receipts etc or is that something these other companies should submit with the claim?

Dazed_and_C0nfused

deihpos said:

molerat said:

deihpos said:

I've looked on HMRC to claim directly but don't understand how I'd do this without lying. Is this legal and will they be asked to repay the money they've received?

That's how they work.  HMRC will issue a refund based on the submission with no questions asked. When they reconcile the year they will find out the claim wasn't valid and will claw it back.  Of course the claim firm have had their cut and you won't be getting that back.

I thought that, I knew it sounded too good to be true. There are a lot of people in my office doing it. Do HMRC contact them to provide receipts etc or is that something these other companies should submit with the claim?

You might find this an enlightening read.  Particularly the "process now check later" aspect.

https://www.litrg.org.uk/news/have-you-used-company-claim-refund-and-hmrc-are-now-asking-you-pay-it-back

[Deleted User]

deihpos said:

molerat said:

deihpos said:

I've looked on HMRC to claim directly but don't understand how I'd do this without lying. Is this legal and will they be asked to repay the money they've received?

That's how they work.  HMRC will issue a refund based on the submission with no questions asked. When they reconcile the year they will find out the claim wasn't valid and will claw it back.  Of course the claim firm have had their cut and you won't be getting that back.

I thought that, I knew it sounded too good to be true. There are a lot of people in my office doing it. Do HMRC contact them to provide receipts etc or is that something these other companies should submit with the claim?

While the company’’act’ for their supposed clients the responsibility for the claim lies with the taxpayer. The company knows that. 

You have been very wise. Your colleagues may have not been and could well be asked to repay 100% of a claim having received 58% of it. 

TheBanker

Family member used one of these companies. They secured a rebate because he uses his car a lot for work, and is only paid 10p per mile by his employer. They charged him about 30% of his rebate for this service. 

Instead of using a P87 form to claim the refund, they registered him for Self Assessment (which was not necessary). They also registered themselves as his agent, and then ignored all further correspondence from HMRC. My friend did not realise he was registered for Self Assessment until he received a letter from HMRC saying he had to pay a penalty for not submitting his return.

I helped him to sort it all out, pointing out that it took more time and effort to undo the mess the tax rebate company had created, than it would have taken to fill in a P87 form. And I would have helped him to complete a P87 for free, so he'd have got his full refund instead of giving a third of it to the tax rebate company. I'd also have explained that he would need to update the P87 every year to reflect his mileage (which varies), and he needed to keep proper records. I have no idea how the tax company worked out what his work mileage was, but when I was sorting it out we had to spend several days working through his time sheets and expenses claims because he hadn't been keeping a log. 

Partly my family member's fault for not reading what he was signing up for properly and not reading/understanding some of the HMRC letters - but I would advise anyone to avoid these companies. Sadly they often seem to have partnerships with Trade Unions, which is wrong as using them will generally not be in the best interests of the union's members.