It often pays to query HMRC’s decisions

First published on 07 September 2021 by Alastair
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News reaches us of “alarming” official figures that show HMRC was forced to do an about-turn on three in every five tax decisions queried by taxpayers in the tax years 2019-20 and 2020-21.  All in all, taxpayers challenged nearly 32,000 of HMRC’s decisions over this period, resulting in reviews that led to almost 20,000 decisions being cancelled or altered.

In particular, these figures show that automatic HMRC decisions about charges such as penalties for late filing of tax returns and the VAT default surcharge were overturned in some 80% of cases where taxpayers complained. In total, fewer than one in five of the tax authority’s initial conclusions were upheld.

However, on the other side of the coin, ‘non-automatic’ decisions made by HM Revenue & Customs were upheld more often. That said, HMRC had to cancel or vary 25% of all of the decisions taxpayers challenged over this same time frame, with the tax authority beating a retreat on more than 1,000 earlier determinations.

Our advice is that if you are in any way unsure of a tax bill or penalty received from HMRC then you should check with an accountant. We know quite a good one if you are not sure whom to call!

Vivian Linstrom, M&S Accountancy & Taxation

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