How do they manage it? Even when it is announcing that 4 million taxpayers will get repayments, the country's favourite whipping boys HMRC still managed to get reviled by every arm of the media. Dave Hartnett may not be the perfect spin doctor but the treatment that has been meted out to him has been brutal.
HMRC has finally projected itself into the 21st-century with a sexy new PAYE/NIC computer program. After sorting out the teething troubles, this should introduce the world of real-time to employee taxation and avoid under and overpayments of tax in future.
This is greatly to be commended and will help to redress the imbalance caused by mass staff cuts and resignations in the department.
However, this has also led to front-page news headlines for a week, after it was announced that six million workers have paid the wrong amount of tax due to faulty notices of coding.
It is frightening to learn that people did not know that the coding system was only an approximation and will always require year-end adjustments, especially where circumstances have changed. This is the system working properly, not falling down.
There may well be cases where errors have crept in and it is not unreasonable to take HMRC to task over that. However, putting it on the scaffold and chucking rotten tomatoes when it has done its job is a wholly inappropriate response.
Strangely, while the press is clamouring for the underpayments to be written off, nobody is suggesting that those entitled to repayments should forego them. While one must sympathise with people learning that they will have £100 a month or more deducted from their salaries next year, this is tax that they owe and it is hard to see why the rest of us should subsidise them.
This tax fiasco does raise questions and provide some opportunities. First, anybody that does get a bill or notification of repayment should check the figures carefully. This new computer system is reputed to be a little leaky and some calculations may be incorrect.
Everybody who is taxed through PAYE and does not complete a tax return should also check their tax codings and deductions for recent years. HMRC has identified four million people who are entitled to repayments for the last couple of years but there must be others that they have not discovered and one of them could be you!
Taking matters a stage further, if individuals who are taxed under PAYE and do not submit self-assessment returns find they have overpaid tax, they might also wish to claim repayments going back six years, as still provided by statute, rather than the four years for self-assessment taxpayers.
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Philip Fisher, Partner, PKF
