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Tuesday, September 7, 2010

Tax blunder rebellion: Experts urge 1.4m NOT to pay up for the taxman's mistake


Demanding tax: The first batch of letters demanding cash to be repaid will start to arriving this week
Demanding tax: The first batch of letters demanding cash to be repaid will start to arriving this week
Around 1.4million Britons are being urged to stage an unprecedented revolt over plans to claw back up to £3.8billion in under-paid tax. 
It follows the botched introduction of a new computer system by the taxman which has left millions of bills in chaos.
The first batch of 45,000 letters demanding cash to be repaid will start to arrive on Tuesday - with the rest sent out over the next four months. 
But accountants said recipients should act swiftly to use a little-known loophole which forces HM Revenue and Customs to abandon 'out of the blue' demands and effectively write off the money.
They also insisted many of those affected are entitled to argue that they or their employer have done nothing wrong and should not be penalised for someone else's blunder. 
The advice has been issued after last week's admission by HMRC - highlighted by the Daily Mail on Saturday - that it has claimed too little, or too much, tax from 5.7million individuals. 
As far back as February a Money Mail investigation exposed how the Revenue had known for months that the new tax code system was heading for chaos - but failed to stop it.
The majority of those affected by the chaos, around 4.3million, will be winners, and can look forward to an average rebate of £419.
But around 1.4million face paying an additional bill - at an average of an extra £120 a month, or £1,428 in total.
This is a significant sum for all but the richest in society, equal to nearly a whole month's take-home pay for the average worker earning £25,000.

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