Debt risk: HMRC knew of tax code problem

17/02/2010

HM Revenue and Customs (HMRC) knew about the problems concerning mistakes on tax codes but failed to tackle the problem in time, Money Mail has revealed.

An investigation by the publication found that thousands of people were left at the risk of debt as they were issued with tax codes which did not correspond to their circumstances.

Debt management plans may be needed by graduates who, already having paid off their student loans, were caught up in the fiasco as money could continue to come off their wages due to the computer error.

The errors also affected other employees who were already on tight budgets due to the effects of the recession as hundreds of pounds were wrongly taken from their pay cheques in tax deductions.

Money Mail found that the minutes of two meetings show that the HMRC was aware of the problem in September, but failed to make the necessary changes or to warn taxpayers of the risks.

Thousands more could be affected by the mistakes if they are not corrected in time for the new tax year, which begins in April.

Posted by Jim Mead

Tags; Budgeting Advice,

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