Is the new RTI system actually working ? HMRC has “stopped” issuing income tax repayments after a leaked email revealed that end of year tax reconciliations for thousands of taxpayers may have been calculated wrongly, the Telegraph reported. Elaine Clark, who runs the tax practice Cheap Accounting, said she understood that repayments for 2013/14 had been halted. “This concerns me enormously given that RTI was meant to correct all evils, all payroll information would be up to date and everyone would be paying the right tax. How can we get reconciliation errors? There has to be something in the system,” she said. Employers had invested time and effort in RTI and were putting good data into the system. “At what point does that go wrong?” She added: “HMRC needs to step up to the plate very, very quickly and find out what the problem is.” The Telegraph reported that “HMRC said tens of thousands would ultimately be affected but admitted it currently had no idea about the scale of problem”. It added that a spokesman for HMRC said the incorrect letters were not demands but merely tax summaries, and that “no one has been asked to hand a penny over in tax because of this”. HMRC said “The majority of the errors have happened because an employer failed to make a final payment statement for the 2013/14 tax year meaning our records were incomplete despite reminders that these submissions had to be made. We are sorry this has happened and we will issue corrected calculations in the next few weeks.”
Posted on: Thu, 09 Oct 2014 11:40:33 +0000