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Tax repayments: are there continuing delays in 2016?

Delays in receiving tax refunds
Throughout 2015 the Tax Faculty continued to receive reports that there were significant delays in the tax repayment process. We continue to raise this matter regularly with HMRC but would like up-to-date evidence of the current position.

If you are having problems with delays in the processing of tax refunds, please post a comment below. Please tell us:

  • What the overpayment relates to – SA, non-SA, CT, PAYE, PAYE offset of CIS payments, or something else
  • The amount of the tax repayment and year it relates to
  • How long you have you been waiting, or if the repayment has now been received, how long it took to be processed
  • Whether you had to call HMRC to chase the repayment and if so how many times
  • If the repayment was withheld by HMRC, the reason for this, if you know it
  • Whether you have seen an improvement in the repayment process in relation to any specific tax (or taxes).
Don’t forget that in April 2015, HMRC systems were brought into line with banking industry standards so that, wherever possible, repayments are made back to the credit card or debit card used to make the payment on the self assessment account.
The repayment will be made back to the card where all of the following criteria have been met:
  • the most recent payment was made using the card
  • the payment was made post 5 April 2015
  • the repayment is no more than the amount of the last payment made
  • the payment was made within nine months of the creation of the repayment.
HMRC’s system will automatically attempt to repay to the card regardless of any nomination made on the tax return stipulating a different account, so agents should be aware to look out for this and warn their clients that their tax repayment may not be made where they are expecting it to.
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  • HMRC are totally inconsistent in dealing with repayments, all due after the submission of clients tax returns. 

    One client received a repayment of over £6,000 automatically. Another client owed about £500 required a telephone call, HMRC stating that the tax return didn't indicate it should be paid to the client.

    In other cases it was necessary to go on line and request the repayment be made to the clients bank account. This was for a small amount.

    All our tax returns requested that any repayment be made to the client. Information provided by HMRC on the phone was inconsistent.

    Richard Norton
  • A client of mine is an employer with only 2 employees, one of which went on maternity leave this year.  The RTI payroll submissions were made and now the PAYE/NI account on the HMRC website shows approx £5k refund owed to the employer because the SMP far exceeds the total PAYE/NI.  On 12th November 2015 the client wrote to HMRC to request it to be refunded: HMRC replied by letter on 4th March 2016, attaching a form for the client to fill in and return: The form asks for full details of how the SMP is calculated.  I find it extremely annoying that this information is required, as the SMP has been calculated by the payroll software.  Surely the information provided by the RTI submissions should be adequate for HMRC to accept the calculations (and if not, why not?).  We intend to fill in the form because I expect any other course of action would incur even longer delays, but even so, I am not at all confident of HMRC issuing the repayment in the near future.    
  • Submitted CT600 on 13 July 2015 with a repayment of £970 due for prior year.  Assumed repaid until contacted by client in January.  Spoke to HMRC on 5 February who said they would action repayment which would take four weeks.  Spoke again to HMRC today (18 March) who confirmed nothing had happened and they will now escalate the case and phone me back in three days.

    Due to HMRC incompetence client has incurred monthly bank fees as company will be wound up once repayment received.
  • Thank you to all those who have posted comments on this item.

     

    Please note that the Tax Faculty cannot assist with specific problems. Individuals without a tax agents may find useful information on the websites of charities such as the Low Incomes Tax Reform Group. Those on a low income may qualify for help from the tax charities TaxAid and TaxHelp for Older People.

     

    For those agents experiencing difficulties with client-specific issues such as obtaining refunds, and who have exhausted the normal channels of communication with HMRC, the Tax Faculty recommends that you register and use the HMRC Agent Account Manager to try to get the matter resolved satisfactorily and speedily. Please let us have your feedback by posting a comment at HMRC Agent Account Managers – what are your recent experiences?

     

  • I have been told that HMRC is very behind with CT repayments and my experience supports this. We had to wait 20 weeks for a repayment from a terminal loss relief claim.  Claim was submitted for a client as part of CT return on 14 December 2016 and has only just been repaid (on 5 May 2016) and only then, it seems, when I called to chase.