HMRC computers ignore payment on account changes

urgent message in a bottle
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Richard Hattersley
Community correspondent
AccountingWEB
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HMRC's online self assessment systems ignored applications to reduce payments on account for 2016/17 without notification, a number of tax agents have reported.  

Kevin Salter, deputy chairman of the ICAEW technical committee, blogged about his experiences with an application filed on 12 December that was not actioned by HMRC - despite receiving confirmation of the reduction from the tax department.

He discovered the online glitch after looking up a different point regarding his client’s tax liabilities. But the online system showed the full amount on the submitted 2016/17 as still being due.

When Salter called HMRC he was told the application had been “rejected”. In his blog Salter fumed: “There was no indication or notification that this had happened, and the first we would have known about it had we fortuitously not logged in would have been in February when the client would have received a statement, or more likely, a surcharge penalty for non-payment. HMRC were able to make a manual adjustment to put through this postponement.”  

He added: “Who ever thought of the transferable marriage allowance? This must be an absolute administrative nightmare!”

His is not an isolated case. Several other ICAEW members reported similar issues. David Holm found that a reduction submitted on 14 September had also not been overlooked by HMRC Online. After contacting the agent line, Holm reported: “They said that inexplicably their system had treated the reduction as being for 2015/16 and, because the 2015/16 return had already been filed, the reduction was ignored.”

Robert Lee had to get the agent helpline agent to manually input his clients’ applications after he realised they had not been processed.

Salter, who posed the question “What hope for Making Tax Digital?” in his blog post, reported other online issues – including a partnership self assessment registratioo form filed in February 2016 that sat unprocessed in HMRC’s system.

“Three weeks to the filing deadline now and hopes of getting a UTR on time are fading fast!!” he wrote.

What experiences have you encountered with HMRC online SA forms and reports? Have you had to call the agent helpline to get missing data processed - and how did they respond? 

Replies

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12th Jan 2017 10:34

All the more reason for ignoring MTD until such time HMRC can get their current act together.
By the way, has anyone tried to verify a partnership subcontractor for CIS payments by a contractor? Didn't work online so phoned CIS helpline who did verify the partnership straight away. I relayed my online experience to the helpful person from HMRC who said "it hasn't worked online for a long time and despite our having told "them", nothing has been done".
Harra etc forget MTD. Get yourselves sorted first.

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12th Jan 2017 10:42

HMRC have confirmed to me that the problem is that although the online request is for 2016/17 the software treats this as a request for 2015/16 and rejects it (as payment dates have passed); without telling anyone!

If the request is done over the telephone then this appears to overcome the problem. Just what is needed in January!

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12th Jan 2017 10:58

I've been trying to get a UTR for an LLP. HMRC's system should issue it when it gets advised that an LLP is incorporated, but didn't.

After an hour of being passed from Self-Assessment helpline (we don’t know, we’ll pass you to Technical) to Technical (we don’t know, try Corporation Tax helpline) to Corporation Tax helpline (we don’t deal with LLPs, phone the Self-Assessment helpline and they’ll put you through to Technical) my assistant lost the will to live.

The HMRC staff were trying to be helpful, but none had a clue what to do. Eventually ended up being told the Corporation Tax Helpline would help, so passed back to them. They said they couldn't help, write in to Corporation Tax Services, HMRC, BX9 1AX - so no chance of getting the UTR until after 31/1/17!!

Will our client pay us for this wasted time? I doubt it!

I suggest that HMRC start consultations for a new campaign - MTF - Making Tax Farcical.

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to BryanS1958
12th Jan 2017 11:50

BryanS1958 wrote:
Will our client pay us for this wasted time? I doubt it!

Why on earth should the client pay you for wasting your time? I really don't understand why you'd spend hours on the phone like that. Next time spend 5 minutes writing a letter asking for the UTR and wait for HMRC to do it in their own sweet time. Chasing around HMRC on a fools errand seems completely pointless, especially in Jan when there are deadlines to meet!

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12th Jan 2017 11:04

I have had this problem with some quite large amounts - HMRC advised me that 2017 requests were actioned as 2016 even though the claims to reduce had been submitted after the 2016 returns had been filed.
Perhaps this is HMRC's next big thing - do away with tax years?

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By SXGuy
12th Jan 2017 11:05

This happend last year to us. 4 times we sent a claim in and everytime it was rejected without reason or warning until finally the 5th claim went through. I don't know what they are playing at but clearly it's one of the many incompetentcys at hmrc we deal with.

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By suepg
12th Jan 2017 11:08

Please can you confirm whether the application to reduce is being done on the 2016 SAR and if so, is that using 3rd party software, or HMRC software - or is it being submitted via the client link ?

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to suepg
12th Jan 2017 11:16

Mine have all been via the client link.

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to suepg
12th Jan 2017 11:17

suepg wrote:

Please can you confirm whether the application to reduce is being done on the 2016 SAR and if so, is that using 3rd party software, or HMRC software - or is it being submitted via the client link ?


We use Iris but all of our claims to reduce are transmitted within HMRC Online Services so it presumably is being sent to them from within their own system.
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By suepg
to suepg
12th Jan 2017 11:33

Our mail has just arrived in the office and I can now reply to my own query...in case anyone else was wondering! We have received three self assessment statements this morning for clients who had requested (for absolutely legitimate reasons) that their payments on account be reduced - all three have been rejected/ignored. Two of the three were Trust returns (Trust closed doen in 2016-17) and the third is a personal SAR - all were filed using 3rd party software and the claim to reduce was made on the return.

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12th Jan 2017 11:28

I to had an experience with this problem. I went back into the Account and changed it all again, will check up on the Outcome, I may get an difficult phone call from the client in the near future, wish me luck.

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12th Jan 2017 11:46

I've had a similar situation last week. Computer just didn't update the payment on account reduction. It was done manually by the agent helpline.

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By TUSSIES
12th Jan 2017 11:47

We have been in practice for over 30 years and I can honestly say that, in all that time, we have never experienced so many inconsistencies and so much incompetence as we are doing nowadays! HMRC needs taking in hand by someone who knows what he/she is doing! What Hope for Making Tax Digital - at the moment, absolutely none!

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By Sparkly
12th Jan 2017 12:16

What about the ongoing issue with Class 2 National Insurance liabilities being ignored and adjustments made leaving Class 4 NI payable and Class 2 reduced to NIL. It's a shambles this year

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By txcjg
12th Jan 2017 12:26

Partnership 2014/15 SATR filed on time showed cessation date and accounting date to cessation in 2014.
Checking account before deleting as agent Dec 16 found 2015/16 SATR issued 6/4/16. Agent helpline had to remove issue

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12th Jan 2017 12:28

It has come to the stage for everyone to play trumps with HMRC. And get your retaliation in first.

EVERY time these mistakes occur , I demand a full investigation be carried out by the Revenue and that a written report reaches my desk within the next 28 days as to what went wrong . Under no circumstances , I tell the Revenue, should the telephone be used, to explain but email will suffice. I also demand written assurance that full steps are taken to ensure that these mistakes will not be repeated. I also demand that a copy of the explanatory letter to me is sent to my client[s] , as they are duty bound to do so . More importantly , I also ask the Revenue to consider the matter of compensation for this unacceptable poor service and the additional time / administration caused.
A simple standard 5 minute letter.

Sadly, this course of action detracts the valuable time the [remaining] HMRC staff have on their hands but clients are kept informed and often pleased with a little windfall rather than paying for my time correcting the Revenue's continued glitches.
With Harra's MTD trash hitting the fan shortly , it's good practice for further inevitable HMRC serious shortcomings. Suggest everyone mans up and adopt a similar approach and get HMRC to revert to being 'your obedient servant'. Anyone remember those days ?

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By Sparkly
to Mr J Andrews
12th Jan 2017 12:39

I too have now adopted a standard complaint letter - much quicker and more useful than sitting on the phone, wasting valuable time. I also have a current claim for compensation going through which has already received prior agreement from them (I just had to wait for client to settle their bill first) Agree if we ALL did this maybe HMRC would soon invest some time and effort into actually resolving these ridiculously petty issues and hopefully someone somewhere would finally realise at HMRC that they can't possibly hope to bring in MTD on time without the whole system falling over whist they appear to remain incapable of resolving what appear to be really simple issues!

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By Maximus
12th Jan 2017 15:46

Just checked and this has happened on my client too. I reduced his POA from £173k to £100k and it has not been done. The person I spoke to said this seemed to have been quite a common problem - yes, I said, it's on AccountingWeb! Hopefully it will now go through.....

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12th Jan 2017 16:06

You know what - provided you know you have correctly claimed a reduction, have copied the acknowledgement, sent a copy to the client then you should do what I do. Completely and utterly ignore what spews out of HMRC digital mouth. Eventually it will be corrected. Blood pressure pills will be saved and phone bills will be lower.
Harra etc STILL waiting to hear from you.

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12th Jan 2017 16:25

Yes, I to have experienced a similar problems with adjusting 2016/17 Payments on Account. It was corrected via the Agents Helpline who advised that HMRC had a software problem.

I am also experiencing inexplicable changes to client address' on their HMRC Account

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12th Jan 2017 17:11

I have posted on moneysavingexpert.com several times that if a COMPLAINT CASE and COMPENSATION CLAIM was raised every time HMRC gross incompetence affected taxpayers, we'd be looking at the best part of a billion per year in payouts.

Now that would really grab their attention! Instead of letting the Numpty Department loose on MTD they'd be forced to behave like a sensible business.

So more staff would be recruited - proper staff, not just the latest trawl from the monkey cages down at the zoo which seems to be current HMRC recruitment policy especially at senior management level.

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12th Jan 2017 17:32

when i phoned agent helpline i was told it could take several MONTHS! to compete authorisation. Not looking hopeful for January deadline I asked for my call and reason for call to be noted for future reference should i need to take penalties to appeal tribunal

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12th Jan 2017 18:13

I have long taken the view tat civil servants have been abusing modern technology to make themselves inaccessable to te public. it is a mark of laziness and a flagrant abuse of power and disrespect for the citizens of this country. Even our elected representatives are faced with insurmountable difficulties in their efforts to contact government department officials on behalf of their constituents. How often have you called a 0300 number to end up in a telephone menu loop? MTD is just another excuse to abuse and frustrate the citizen. The civil service code of practise has clearly been shredded. One of my clients was recently told by a government department official when he called to complain " we don't do complaints!"

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12th Jan 2017 18:10

There you are then. Let us follow their dictum and, when asked by HMRC about MTD we merely say "we do not do MTD"
Seriously though will someone from HMRC wake up, smell the coffee, lie down in a darkened room, gather themselves, take the plunge and at least have the decency to go public with the proposal for MTD. Without exception none of my clients have heard of it.
Harra come out of your shell and give me a ring. The dare continues.

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12th Jan 2017 18:33

We applied for a Utr number on 28th October. We phoned in December for an update. We were told it would be sent by 4th January. We phoned yesterday. We were told that it was issued 11th October. It arrived today with the client. Can't wait for MTD. HMRC will really make it work. The level of staffing and the ability and training of the staff is a worry to say the least

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12th Jan 2017 23:05

Just send in a signed Form 64-8 and ask for the UTR. It may take a 3 / 4 weeks, but you'll get it either by a reply letter or checking your agent accounts online.

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13th Jan 2017 18:07

This problem with claims for reducing payments on account being ignored in NOT new. It happened to us regularly over the past few years.

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16th Jan 2017 09:26

I have just made a call for a similar rejection . The explanation was that if the claim is for more than half the 2016/17 tax due then it will be rejected and we must phone HMRC .
I am not sure if this is procedure or a fix to a problem

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16th Jan 2017 09:34

Tell HMRC to do what THEY are instructed to do. They must not be allowed to impose rule changes without first advising all agents and taxpayers. I would ignore them and just carry on. This is happening all too often and they just refer to their guidance notes. It is not written in law.

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By Sparkly
16th Jan 2017 12:08

Phoned HMRC about two clients this morning where we have made claims to reduce payments on account for 2016/17 six months after we filed the 2016 Tax Returns. I was smugly told that they'd been rejected because obviously 2015/16 payments on account had now passed! I pointed out that it was a known problem and was all over Accounting web. He said that the guidance they'd been given was to ask us to call the online service desk. I pointed out that we don't have time to do this in January and was told that I shouldn't speak to him like that! I didn't shout nor did I swear! Appalling service.

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to Sparkly
16th Jan 2017 23:32

yup they are out of control

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17th Jan 2017 08:31

As they have been for a long time. I really now get more of an impression that the lunatics are running the asylum.
Harra - where are you?

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20th Jan 2017 16:33

Over the many years I have been in practice I have found SA to be pretty robust and reliable.

In the 2015/16 filing year I have experienced problems with the marriage allowance transfer, class II NI discrepancies and now failure by HMRC to act on claims to reduce payments on account.

I believe these are all symptoms of austerity cuts inflicted on HMRC by politicians of all colours over the last 10 years or so. All the good HMRC people have gone. The ones left behind don't have a proper grasp of what they are doing.

A tipping point has been reached. I no longer feel SA is robust and reliable.

What is the destiny for a country which cannot manage its own cash book? We should all be concerned.

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