Dear Tax Forum
I would be very grateful for any help regarding this situation.
We have an RTI error due to Xero accounts system migration.
The error has led HMRC to treat Month 6 YTD salaries as monthly amounts, and calculate tax incorrectly, showing a liability roughly equal to six times the company's then monthly NI/PAYE.
For six months we have been advising HMRC of this error.
They keep saying they understand, but cannot put a timeframe on fixing their data.
What can/should we do?
At one point employees were receiving letters demanding the extra (incorrect) tax.
Chris, call HMRC’s Employer Helpline 0300 200 3200 (have the HRMC employer reference number or accounts office reference number to hand) and ask for your case to be sorted out by the Disputed Charges Resolution Team (the name may have changed).
If this does not result in a satisfactory outcome within a reasonable timescale then make a formal complaint to HMRC https://www.icaew.com/en/technical/tax/working-with-hmrc/making-complaints-to-hmrc
You could also at that stage write to your MP as continuing mistakes by HMRC in processing PAYE RTI data wastes a lot of businesses’, agents’ and HMRC’s time which costs money and doesn’t bode well for Making Tax Digital.
Please let us know how you get on by posting a comment below.
Belated thanks for this response, so sorry to have missed it. We finally resolved the issue, after around 18 months and numerous calls. It was a very strange process, with HMRC seemingly chasing non-existent differences around their system. It was only finally cleared when they deducted the "phantom" debt from the client's VAT refund, and the told us we could deduct that amount from our next PAYE bill. We just need clarity on the related erroneous interest charges, and then,fingers crossed, in the clear. thank you again for replying. All best wishes, Chris Hainsworth
Dear Tax Faculty Team. I spoke too soon. Days after following HMRC advice to deduct from our monthly NI/PAYE an amount they'd erroneously deducted from our VAT, we received a call asking why we had done this. I've called just now and been cut off, and have documented numerous calls where HMRC acknowledged the issue.
I suspect we will need to make the complaint online. So frustrating, when we have on record numerous HMRC reps agreeing our position, and then another pops up demanding a non-existent debt...
The original problem related to us switching from FreeAgent to Xero and HMRC mis-allocating payments.
Subsequent calls over the 18 months just resulted in the "difference" being chased around the HMRC system, with noone able to offer us a timeline for resolution.
We thought this was all resolved when HMRC repeatedly told us to offset the "difference", but sadly not...
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