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Taxman Pays Up
The Paymaster-General, Dawn Primarolo, was recently asked a Parliamentary Question about how much the Inland Revenue has paid out in recent years to compensate taxpayers for the department's mistakes. The figures were £2.57m in the year to 31 March 2002, £2.28m to March 2003, and £2.4m to March 2004.
The Revenue have a policy on complaints in which they explain that they will try to put things right and apologise when they have caused a problem. They will also pay compensation for costs incurred, although they may not pay for everything, and they may question the figures. If the taxpayer had to engage an accountant to sort out the mess, the Revenue won't pay the accountant - the accountant has to charge the taxpayer, and the taxpayer claims the cost back from the Revenue.
Occasionally, the Revenue also pay a 'consolatory payment' on top. This is the only thing that is supposed to reflect the annoyance and inconvenience - unfortunately, your own time sorting out the problem is not a 'cost incurred', because you didn't write a cheque to anyone else, and they won't pay for it. The consolation payments are often so small that they are almost an extra annoyance when compared with the time taken, but they are supposed to recognise that there was a problem. They are also tax-free.
If you think that you have been messed about by the Revenue, or by any other government department, we will be happy to advise you on whether it is likely to be worth pursuing a claim for compensation.
| The main starting point for complaints against the Revenue is the booklet COP 10, which sets out the Revenue's policy. A request for compensation should be made first to the relevant Tax District, setting out the nature of the problem and also what the complainant wants to put it right (whether an apology or compensation as well, and if compensation, then how much and for what). If the complainant is unsatisfied, it is possible to pursue the complaint further, ultimately to the Revenue Adjudicator. |
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