HMRC may have missed time limit on tax bills
07 Sep 2010, Accountancy Age, AccountancyAge
http://www.accountancyage.com/aa/news/1809106/hmrc-missed-limit-tax-bills
People hit with an unexpected tax demand may be able to refuse to pay up as HM Revenue & Customs could have exceeded its own time limits in which to ask for the money, experts said, the Scotsman reported on its web site.
Under tax rules HMRC must issue demands for underpaid tax within 12 months of the end of the tax year in which it became aware that people had underpaid, the newspaper added.
It emerged over the weekend that nearly six million people have paid the wrong amount of tax through the Pay As You Earn (PAYE) system.
Around 4.3 million of these have paid too much and are due a refund, but 1.4 million have underpaid and will have to handover an average of £1,428 each.
But if people provided HMRC with all the information they needed to get their tax code right, it should have used this information within 12 months of the end of the tax year in which it was received to claw back the extra money.
Further Reading:
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Visitor comments
CATCH22
PAYE EMPLOYEES CANT SUBMIT ONLINE TX RTNS AS SAME NOT DUE AS PER HMIT ON TOP OF NO UTR ISSUED TO THEM. SO HOW CAN THEY SUBMIT THEIR CORRECT INFO TO HMIT TO GET THEIR WRONG TAX CODES CORRECTED, WITH/OUT HIRING ACCOUNTANTS!!! SAME BEING E TO 'HMRC' SEPARATELY FOR THEIR REPLY, BY NEXT MONTH @ EARLIEST IF LUCKY!!!
Posted by: F W , 07 Sep 2010 | 00:00
Vital ingredient missing
To avoid the demand you will have to prove that you thought your affairs were correct and up to date. Could be hard if you have been receiving incorrect tax codes.
Posted by: Andrew Clarke , 07 Sep 2010 | 00:00
What have the National Audit Office been doing?
The National Audit Office audits HMRC's Trust Statement every year, this includes an IT audit of the PAYE systems. How come they missed it?
In 2007 the NAO published a report full of praise for the FSA, six months later Northern Rock collapsed under its nose.
Sounds like a worthless quango to me. Lets hope it goes the same way as the Audit Commission.
Posted by: Jason Parks , 07 Sep 2010 | 00:00
PAYE problems are still recent...
Of course, the vast majority of errors occurred from January 2010 when HMRC introduced their new national system. So for 2009-10 this concessionary treatment cannot be applied for unless HMRC do not issue a demand until after 5 April 2011.
Posted by: James Geary, Rabjohns , 08 Sep 2010 | 00:00