THE ASSOCIATION OF TAX TECHNICIANS is calling for the involvement of external tax specialists in a review of HMRC’s real-time PAYE (RTI) system after incorrect liabilities summaries were sent to employees.
The call follows reports of a second blunder in six months that has seen a collective 5.5 million people affected by miscalculations.
A private exchange shows that those who underpaid or overpaid income tax last year may still have paid the wrong amount, the Telegraph reported this week.
Most have already been sent new demands or refunds, but will now have their liabilities recalculated once more.
HMRC has ceased sending repayments until the problems are resolved.
In June, HMRC admitted it had collected the wrong amount of tax from more than five million people in the 12 months to April 2014.
Since then, the taxman has sent those affected notification letters explaining how it would claw back or issue refunds for on average £300.
The recipients were advised to tell taxpayers who questioned their bills “not to repay any underpayment” of tax.
ATT president Natalie Miller said a review of the RTI system was “urgent”.
She said: “We have been drawing HMRC’s attention to the quirks and complexities of RTI in meetings and correspondence from its inception. We have also highlighted the significant burdens it places on employers and agents. What we are seeing now are real and serious practical problems for possibly many thousands of employees at a time when building confidence in the system is crucial. Some of those difficulties might have been avoided if HMRC had heeded advice from ATT and similar bodies at an early stage.
“In light of this latest revelation, we are calling for an urgent review of the RTI system to ensure that it is fit for purpose. This is essential because every employer and employee is entitled to know that PAYE is being dealt with properly.”
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