Call us if you have any questions
T: 0808 168 2772

Business News


HMRC Profiting From Tax Refund Delays?

HMRC Profiting From Tax Refund Delays?

In recent weeks HMRC has denied profiting from tax refund delays. Leading accountants have claimed that these delays are becoming more and more widespread and the waiting period for a refund can often take months. This new dispute follows the miscalculation of PAYE liabilities last year which was also well documented through out the media. At the time, this was also denied before the ever sheepish HMRC held their hands up to their mistake.

At present, despite denials one thing is certain: when the taxman charges 3pc on overdue bills but only pays 0.5pc on overpaid tax it is due to repay, then HMRC has a vested interest in delay. These delays in tax refunds have become more common in recent years but it has been made substantially worse by HMRC taking as much as ten weeks to carry out security checks on individuals due refunds. There is no denying that there is a need to carry out these checks but a waiting period of ten weeks is undeniably long and excessive.

Individuals are now being advised that completing a self assessment tax return may not be enough to produce a refund where one is due and that they should be prepared to chase HMRC sooner rather than later.

A spokesman of HMRC has stated that: “Most refunds are made very promptly but we carry out a range of automatic and manual checks to make sure the refund is a genuine one.

“Also, the rate of interest on overpaid tax reflects the average commercial rate for a return on deposits. No commercial body has the same rates for both paying and charging interest.

“The rate of interest charged on unpaid tax is designed to encourage payment at the right time and to recompense the Exchequer for the loss on taxes paid late. If the interest rate on overdue tax was too low, it might encourage people to treat HMRC as a source of cheap credit. If the interest rate on overpaid tax was too high, it might encourage banking with HMRC.”

The question we all need to ask is can we call outright incompetence an attempt to profit. It may boil down once again to the sheer complexity of the tax system but surely not everyone out there suffers from these errors. A lot would agree that HMRC need to take a long, hard look within.

Call us now and let's get started!
We'll help you to decide which solution is suitable for your business. Give us a call now!
Mill Suite Hardmans Mill, New Hall Hey Road, Rawtenstall, Lancashire, BB46HH

Telephone: 0808 168 2772

E: T: 0808 168 2772 F: 0845 386 0469
Mill Suite Hardmans Mill, New Hall Hey Road, Rawtenstall, Lancashire, BB46HH