Taxman denies profiting from tax refund delays

Taxman denies profiting from tax refund delays

HM Revenue & Customs denies holding on to money due to low interest rate

The taxman has denied that is profiting by holding back on tax refunds.

With HM Revenue & Customs charging 0.5% interest on tax it is due to repay but 3% on bills that are due, the Telegraph suggested that the taxman had a “vested interest” in delaying payment.

Advisers said that the taxman was taking longer to pay out refunds, with some being delayed by as much as ten weeks while random security checks were undertaken – described as excessive by Smith & Williamson head of tax Richard Mannion.

An HMRC spokesman told the newspaper that most refunds were paid “very promptly” and that its rate on overpaid tax reflected a return on deposits while the rate on unpaid tax was designed to encourage payment at the right time.

“If the interest rate on overpaid tax was too high, it might encourage banking with HMRC,” said the spokesman.

Share

Subscribe to get your daily business insights

Resources & Whitepapers

Why Professional Services Firms Should Ditch Folders and Embrace Metadata
Professional Services

Why Professional Services Firms Should Ditch Folders and Embrace Metadata

3y

Why Professional Services Firms Should Ditch Folde...

In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...

View resource
2 Vital keys to Remaining Competitive for Professional Services Firms

2 Vital keys to Remaining Competitive for Professional Services Firms

3y

2 Vital keys to Remaining Competitive for Professi...

In recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...

View resource
Turn Accounts Payable into a value-engine
Accounting Firms

Turn Accounts Payable into a value-engine

3y

Turn Accounts Payable into a value-engine

In a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...

View resource
Digital Links: A guide to MTD in 2021
Making Tax Digital

Digital Links: A guide to MTD in 2021

3y

Digital Links: A guide to MTD in 2021

The first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...

View resource