© The Financial Times Ltd 2015 FT and 'Financial Times' are trademarks of The Financial Times Ltd.
May 1, 2013 4:12 pm
Complaints from disgruntled taxpayers about the conduct of HM Revenue & Customs (HMRC) are being rejected at a higher rate than at any point over the past five years.
Records obtained under the Freedom of Information Act by accountants Saffery Champness, show that HMRC turned down more than 55 per cent of complaints made between 2011-2012, up from 47 per cent the previous year.
This is the highest rate since the tax office introduced its current complaints recording system in 2007.
“These figures go some way to backing up the anecdotal impression that a lot of us have been getting recently: HMRC is getting nastier,” said Ronnie Ludwig, partner at Saffery Champness. “This significant step up in rejections also goes hand in hand with the high publicity scare tactics being rolled out.”
He added: “Whether this changing attitude is down to renewed energy in stamping out any form of tax planning or an attempt to boost Treasury coffers in line with the austerity agenda is yet to be seen, but the numbers speak for themselves.”
The figures also show that HMRC fully upheld 30 per cent of the 75,568 complaints processed between 2011 and 2012, down from around 39 per cent in previous years.
HMRC reviews decisions imposed on businesses in relation to tax disputes and the late filing or payment of tax. The purpose of these reviews is to resolve tax disputes quickly and cheaply, reducing the number of disputes that go to the Tax Tribunal.
The figures follow previous data relating to HMRC that reveal that its internal VAT decision review process is also increasingly siding against small businesses.
UHY Hacker Young says that just 48 per cent of businesses’ appeals against HMRC VAT decisions were upheld by HMRC’s internal review teams last year, far lower than the 60 per cent of appeals upheld the year before.
“Some worry that the combination of the pressure from the government on HMRC to increase revenues, and the cuts to HMRC’s budget, could be key factors at play here,” said Simon Newark, VAT partner at UHY Hacker Young.
“The concern is that this pressure is leading HMRC’s review teams to either hurry through cases without looking as carefully at the details as they would before, or ‘rubber-stamp’ Officers’ decisions on far less solid grounds. This is leaving more of HMRC’s original VAT decisions unchallenged.”
HMRC has come under increasing pressure to clampdown on tax avoidance and evasion in recent months, but an HMRC spokesman said the department had not changed it complaints approach.
“HMRC serves millions of taxpayers every year and a fraction of a per cent of those customers find it necessary to complain,” said an HMRC spokesman.
“We successfully collected over £469bn pounds in revenues last year, dealing with 60m phone calls and 30m items of post. Our approach has not changed.”
Copyright The Financial Times Limited 2015. You may share using our article tools.
Please don't cut articles from FT.com and redistribute by email or post to the web.