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HMRC apologises for PAYE tax errors, but advisers say ‘more is needed’

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With the Daily Telegraph reporting that ‘more than 5m employees’ may have been affected by errors in their PAYE calculations despite migrating to HMRC’s real-time information (RTI) system, HMRC has apologised but advisers say more needs to be done to make RTI ‘workable’.

In a statement, HMRC said: ‘A number of incorrect 2013/14 tax calculations (P800) and payable orders were issued to customers in a three-week period from 15 September. This issue only affects a small proportion of the 2013/14 P800s and payable orders which were issued in this three-week period, and the issue is limited to income tax only.

‘HMRC is urgently investigating this matter to resolve the issue. In the meantime, those customers who think their 2013/14 P800 may be wrong should contact our helplines for further advice before making repayments or cashing cheques. We are sorry for any worry or inconvenience caused.’

Steve Wade, tax director at KPMG, said: ‘These systems issues are causing so called “employer errors”, which is where the data supplied by the employer is not processed by HMRC systems as expected. Sometimes this can be due to bad data being supplied but equally it can be due to errors in HMRC systems.

‘HMRC is under enormous pressure to deliver “more for less” and budget for additional investment is a real challenge. Can HMRC realistically be asked to deliver such big changes whilst resources are cut? This is a very important initiative, and investment is crucial if it is to succeed. Our view is that it is important that current issues are addressed and fixed before plans to extend the system to encompass benefits in kind are implemented.’

Meanwhile, the ATT called for the involvement of external tax specialists in a review of RTI. ATT president Natalie Miller said: ‘This is an alarming revelation and further underscores the need for collaboration with external stakeholders, all of whom have a vested interest in the success of RTI.’

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