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From: Lesley Rance
To: Pete Wishart, MP for Perth and North Perthshire
Mr Wishart,
I would like to add my voice to those of my fellow tax professionals regarding the delays being experienced by agents in dealing with their client’s tax affairs.
Mike Truman, the editor of our professional publication, Taxation, put three questions to Exchequer Secretary David Gauke MP at last November’s ICAEW Tax Faculty Hardman lecture.
To date, no answers have been forthcoming, and Mr Truman has sent an open letter, published in Taxation and a copy of which I enclose for your reference, seeking a response.
Agents are being asked to write to their MPs to lobby Mr Gauke, hence my letter to you now.
The delays currently being experienced in dealing with HM Revenue & Customs are widespread and increasing and a far from satisfactory service is being provided to taxpayers and their agents.
I have many years' tax experience and, although there have always been instances of delays and errors, matters have gotten much worse in recent times.
The open letter gives a flavour of the problems being experienced by agents, myself included.
However, I don’t just have one example of each of these, I have several:
- HMRC not responding at all to letters and having to send reminders.
- Being advised they have no trace of my letter too many times to count now, and having to send duplicates.
- Being told when sending duplicate tax forms that these will not be given any priority but will go back to the end of the queue and dealt with in strict post order.
- HMRC choosing to respond to only one point raised in letters, thereby necessitating further correspondence to resolve other issues.
- HMRC writing back to ask for a National Insurance number as they could not trace the taxpayer we were writing about, despite our letter having repeated the reference given by them on their previous letter. What’s the purpose of their reference if they cannot trace a particular taxpayer from it?
- Receiving a letter from an office other than the one to whom I have written or other than the taxpayer’s own office. The worst so far is an involvement with four different offices: not so much a case of the right hand not knowing what the left hand is doing but rather, the right and left feet are involved as well, and they don’t have a clue what’s going on either. It used to be the case than an agent would receive a notice advising that the taxpayers records are being dealt with at another office, but that seems to have gone by the wayside.
- Having to continually chase for reminders because 28 days have gone by without any response. Contact by telephone is, for the most part, a waste of time, usually because the person on the other end doesn’t have the papers in front of them or doesn’t have the technical expertise to answer the query. And yes, I’m including in that the dedicated agent helpline, which is supposedly manned by more experienced staff.
- Being told by HMRC that they do not have the mandate 64-8 recorded on their system, when it must be quite obvious from all the correspondence that has already passed between us that we act for the taxpayer. Yes, I know they have to comply with the law, but when it's simply down to them not having updated their systems, it’s the most frustrating experience.
- Being told on the phone that the matter would be passed to someone else to deal with who would be in touch in a few days, and not being contacted.
- Being told that a repayment will be issued sent out within ten days, chasing when it isn’t, and again being told it would be issued within ten days.
The system places the onus for getting things correct wholly at the taxpayer's feet, and HMRC are allowed to absolve themselves from any responsibility when they make mistakes.
Most people have very little awareness of how tax works so. For example, issuing a PAYE coding notice and asking the taxpayer to contact them if they do not think it is correct, is just asking for trouble.
No other profession is able to shift the burden in quite that way. A doctor wouldn’t give you a prescription and leave it up to you to decide whether it was the correct medication or not.
In addition to delays in dealing with matters, I have seen a significant increase in the mistakes being made by HMRC, leading to both under- and over-stated tax. I have to then analyse why their calculation is wrong and write back to them explaining what they should do to correct it.
The errors are, very frequently, extremely basic. I have one at the moment in which, instead of showing the tax deducted from bank interest in the 'tax paid' column, the calculation included the net interest figure.
Why that wasn’t immediately spotted I have no idea, but it resulted in the client being over-refunded the sum of £270. That was HMRC’s third attempt at the calculation.
All the information they required to properly assess the position had been given to them, but they failed to do it three times and yet the onus is on the taxpayer to check that it is correct.
How far does a taxpayer have to go to comply with their obligations? If we’ve tried three times to get them to get it right, do we have to continue until they do?
In this case, its not economical for the client given the delays and costs involved and, in fact, the client has told me to do nothing more.
I would think, however, that if HMRC ever discover the error and seek reimbursement, the client has very strong grounds for arguing against having to repay it.
I daresay you may already have been contacted by other local agents on this subject. I sincerely hope that you will appreciate the importance of what we all have to say, and that you will, therefore, write to Mr Gauke seeking a response to the questions raised by Mr Truman.
Yours sincerely,
Lesley Rance, Miller Hendry, Perth
