[Politics] HMRC. FIT FOR PURPOSE?

[rippleman]

The PAC has published its report into HMRC's appalling administration of the covid support schemes and their failure to recover BILLIONS of taxpayer money paid out in fraudulent claims. A summary, together with a link to the full report, can be found here:

https://committees.parliament.uk/committee/127/public-accounts-committee/news/186552/government-lacks-proof-of-impact-of-97-billion-of-taxpayers-money-spent-on-furlough-and-self-employed-job-support/

The PAC report also confirms that many businesses genuinely in need of support were denied it because of the way the schemes were set up (as I was trying to get across to Tim Loughton MP at the time but he didn't give a toss).

A long time ago I worked for the Inland Revenue where we were told it was our duty to "protect the public purse". What a joke HMRC has become. A CEO of a private or public company who displayed such financial incompetence would be gone. Will the Chair and CEO of HMRC still be in a job tomorrow? I think we know the answer.

 

[Badger Boy]

It's incredibly frustrating how obvious it was that Fraud was rampant in all the Covid schemes and how absolutely certain anyone with any sort of mind was that they would not be able to track all the money paid and clawback everything which incorrectly paid out. There were so many aspects of the Covid response which were so obviously going to end up being major "scandals" but were so obvious to anyone paying attention. Of course they were partying behind the scenes and blowing off the isolation rules. Of course their mates were benefitting from Covid funding ahead of companies who didn't have a Government link. Of course HMRC was doling out cash money left, right and centre and a lot of it was opportunist Fraudsters on the take who would game the system as much as they could to get something for nothing with no consequences.

Government is failing in absolutely every conceivable measure.

 

[cloud]

With no Civil Service left to advise the Government differently, it's no surprise it's become a free-for-all.

 

[Weststander]

It was vital that schemes were in place within days. The TV and airwaves were full of employers, employees and the self employed (and Opposition mischief makers) claiming that an Economic Depression worse than the 1930’s was almost certain. I recall a nsc thread in March/early April 2020 where the self employed spoke of impending personal bankruptcy, loss of homes. Which effectively died a death when their scheme was announced.

Inevitably liars and other criminals seized the opportunity.

The second crime is that the Government and HMRC later effectively decided not to go after the fraudsters. It was not big business political mates, instead it was lying cnts owning SME’s or pretending that they did.

 

[LamieRobertson]

It's incredibly frustrating how obvious it was that Fraud was rampant in all the Covid schemes and how absolutely certain anyone with any sort of mind was that they would not be able to track all the money paid and clawback everything which incorrectly paid out. There were so many aspects of the Covid response which were so obviously going to end up being major "scandals" but were so obvious to anyone paying attention. Of course they were partying behind the scenes and blowing off the isolation rules. Of course their mates were benefitting from Covid funding ahead of companies who didn't have a Government link. Of course HMRC was doling out cash money left, right and centre and a lot of it was opportunist Fraudsters on the take who would game the system as much as they could to get something for nothing with no consequences.

Government is failing in absolutely every conceivable measure.

 

[Seecider]

The whole system VAT/PAE/NI needs simplifying, get rid of lots of small allowances and reliefs, introduce flat rate taxes on transactions, and then the few staff that are left in HMRC will stand a chance.

Don't blame HMRC for failing to prevent fraud in the COVID schemes - at least the furlough scheme and SEISS had some basic anti fraud measures built in. The bounce back loan scheme was wide open.

 

[Seecider]

It was vital that schemes were in place within days. The TV and airwaves were full of employers, employees and the self employed (and Opposition mischief makers) claiming that an Economic Depression worse than the 1930’s was almost certain. I recall a nsc thread in March/early April 2020 where the self employed spoke of impending personal bankruptcy, loss of homes. Which effectively died a death when their scheme was announced.

Inevitably liars and other criminals seized the opportunity.

The second crime is that the Government and HMRC later effectively decided not to go after the fraudsters. It was not big business political mates, instead it was lying cnts owning SME’s or pretending that they did.

HMRC are still investigating and "going after SME's". I understand that they are going after small ones on a sample basis to prove that its not worth it. I am shortly to have an on line (Teams) review of a series of furlough claims by a client with an HMRC officer. Can't think that this client has been picked out other than by random sampling. I'll be devastated if there is a problem. This was a genuine claim, by a genuine business, not some fraudulent SME. HMRC won't be paying the costs associated with this investigation of course.

 

[ManOfSussex]

The state HMRC are in generally - about 5% of The Uk's tax revenue last year was not collected due to HMRC's limitations, not fraud or avoidance. People are making payments to them in good faith, that don't get alocated properly or get lost in HMRC's systems, errors get made such as a PAYE payment being allocated to VAT. They use 3rd party debt recovery/collection companies, payments get made through them, sent to HMRC and frequently never end up where they're supposed to. Prior to Christmas all payments directly to HMRC and via 3rd party debt recovery/collection companies weren't getting allocated and staff were going through eveything and having to do it manually causing an even bigger backlog. They're totally understaffed and underfunded with sytems not fit for purpose.

 

[jcdenton08]

So many services are absolutely shit and getting worse. Nothing shocks me any more. NHS, police, HMRC. Is there a single service that actually works as well as it did 20 years ago in this country?

 

[razer]

HMRC are currently pursuing me for an amount of PAYE that I paid three months ago. I can clearly see the "unallocated" payment sitting on the account which is exactly the same amount that is outstanding and on which they are charging interest. I simply can't be arsed to wait 40 mins on the telephone to tell them.

 

[Weststander]

HMRC are still investigating and "going after SME's". I understand that they are going after small ones on a sample basis to prove that its not worth it. I am shortly to have an on line (Teams) review of a series of furlough claims by a client with an HMRC officer. Can't think that this client has been picked out other than by random sampling. I'll be devastated if there is a problem. This was a genuine claim, by a genuine business, not some fraudulent SME. HMRC won't be paying the costs associated with this investigation of course.

There are millions of SME’s, I own one.

I not talking about your client, you or I, of course.

I’m referring to the 10,000’s crooks within a total of 5.5m SME’s.

 

[Midget]

I find it hard to blame HMRC, it's a symptom of a wider problem. The junior civil service, like public service, was stripped to the bone before the pandemic, there was little resilience to manage something unexpected that needed an urgent response.

Iirc the steer from government was to get the scheme rolled out asap because of the risk of people not having enough money to eat. The risk of fraudulent claims was recognised but considered less immediate.

They had to roll out a completely new way of giving people money, urgently, with no additional resource, while the regular work didn't stop and with staff suddenly also being off in numbers with covid or having to work from home with all the logistical chaos that brought at the time.

All the time erring on the side of making sure no-one went without, rather than not giving it to those who didn't need it - and there were still people that fell through the gaps because it was a complex thing to do.

It's not really surprising if there was no capacity for checks and balances, by necessity it had to be process now, check later like self-assessment. I think they did pretty well to put it in place as quickly as they did, even in the state it was in - these things usually take months if not years to deliver.

Could they have acted sooner on the fraud? I'm not sure they'd even be in a position to deal with it now. It would mean pulling resource from the regular bringing in of money elsewhere, which might then cause equal or greater losses due to time limits expiring etc. And no-one available to answer queries about your PAYE, shirley.

So many govt. departments are still recovering or managing backlog from the pandemic because they were already struggling, it wasn't just the NHS it affected.

Austerity measures can only be taken so far. 'Civil service waste' is a great political trope until trimming the fat goes too far, something goes wrong and suddenly there's no-one answering the phone about your Jobseekers Allowance, or you're waiting months for your passport.

The pandemic was the mother of all something-goes-wrongs, but it wasn't the root cause. The financial loss is ultimately the cost of George Osborne scoring political points a decade earlier - complete short-termism and the perfect example of a 'false economy'. In the long run, it shafts the country.

Imho.

Now watch them do it all over again!

 

[Harry Wilson's tackle]

The whole system VAT/PAE/NI needs simplifying, get rid of lots of small allowances and reliefs, introduce flat rate taxes on transactions, and then the few staff that are left in HMRC will stand a chance.

Don't blame HMRC for failing to prevent fraud in the COVID schemes - at least the furlough scheme and SEISS had some basic anti fraud measures built in. The bounce back loan scheme was wide open.

And flat rate income tax as a % of income. Would save a fortune and as everyone pays according to their income, the same %, it is fair. Can add in some tweaks for finesse.

However others violently disagreed with me on this on NSC when I suggested it, saying it is not fair that a rich may pays 'the same' in tax as a poor man. I tried to point out that 10% of £a million is hugely more than 10% of £10,000, but they wouldn't accept this.

With this level of intransigence we are forevermore going to have income tax used as a bribe at election time. By both sides.

 

[Justice]

It was a chance for the public to also have their nose in the trough many grabbed it with both hands.
Dishing out £50k unsecured loans with no credit check was madness and the guy who organised it is now the PM.

 

[Weststander]

And flat rate income tax as a % of income. Would save a fortune and as everyone pays according to their income, the same %, it is fair. Can add in some tweaks for finesse.

However others violently disagreed with me on this on NSC when I suggested it, saying it is not fair that a rich may pays 'the same' in tax as a poor man. I tried to point out that 10% of £a million is hugely more than 10% of £10,000, but they wouldn't accept this.

With this level of intransigence we are forevermore going to have income tax used as a bribe at election time. By both sides.

I always violently agree with you about that.

For many reasons including:
- if someone does very well in their career, business idea, profession, it seems fine to me that they should keep the majority, 55% or 60% as reward for their endeavours. With decent tax free allowances for the lower paid.
- a single tax rate of say 45% with no National Insurance would be incredibly easy to administer.
- the current system of bands, multiple rates, directly causes changes of behaviour to mitigate tax eg evasion, only working x number of days or keeping profits under a certain level, a wide array of legal tax avoiding measures. This is not based solely on the Laffer Curve economic theory, new taxes legislation actually quantifies the tax take fall by tax once a tax increase settles in.
- the whole system would be transparent and easy for everyone to unsderstand.

 

[Harry Wilson's tackle]

I always violently agree with you about that.

For many reasons including:
- if someone does very well in their career, business idea, profession, it seems fine to me that they should keep the majority, 55% or 60% as reward for their endeavours. With decent tax free allowances for the lower paid.
- a single tax rate of say 45% with no National Insurance would be incredibly easy to administer.
- the current system of bands, multiple rates, directly causes changes of behaviour to mitigate tax eg evasion, only working x number of days or keeping profits under a certain level, a wide array of legal tax avoiding measures. This is not based solely on the Laffer Curve economic theory, new taxes legislation actually quantifies the tax take fall by tax once a tax increase settles in.
- the whole system would be transparent and easy for everyone to unsderstand.

Nailed it

 

[Herr Tubthumper]

HMRC are currently pursuing me for an amount of PAYE that I paid three months ago. I can clearly see the "unallocated" payment sitting on the account which is exactly the same amount that is outstanding and on which they are charging interest. I simply can't be arsed to wait 40 mins on the telephone to tell them.

The HMRC is a total joke. I’m trying to get an overpayment out of them. Does anyone know if there’s anyway I can take legal action against them? It’s only a few hundred quid but it’s got to the point where it’s now a matter of principle and Im totally fed up being fobbed off with crap they tell me.

 

[jcdenton08]

The HMRC is a total joke. I’m trying to get an overpayment out of them. Does anyone know if there’s anyway I can take legal action against them? It’s only a few hundred quid but it’s got to the point where it’s now a matter of principle and Im totally fed up being fobbed off with crap they tell me.

You can try with the slightly sinister sounding Adjudicator’s Office once you’ve gone through the HMRC official complaints procedure. A friend of mine did this and got monies owed plus interest.

How to complain to the Adjudicator's Office about HMRC or the VOA

When and how to complain to the Adjudicator's Office about HM Revenue and Customs (HMRC) or the Valuation Office Agency (VOA).

www.gov.uk

 

[Herr Tubthumper]

You can try with the slightly sinister sounding Adjudicator’s Office once you’ve gone through the HMRC official complaints procedure. A friend of mine did this and got monies owed plus interest.

How to complain to the Adjudicator's Office about HMRC or the VOA

When and how to complain to the Adjudicator's Office about HM Revenue and Customs (HMRC) or the Valuation Office Agency (VOA).

www.gov.uk

Useful to know. Thank you.

 

[Carlos BC]

The HMRC is a total joke. I’m trying to get an overpayment out of them. Does anyone know if there’s anyway I can take legal action against them? It’s only a few hundred quid but it’s got to the point where it’s now a matter of principle and Im totally fed up being fobbed off with crap they tell me.

Agree, they are pants. I have clients that have been waiting almost a year for higher rate tax relief on pension contributions to be paid back to them.