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“HMRC is part-way through an ambitious programme to bring in digital services and reduce its costs. In doing so HMRC must ensure it maintains adequate services if it is to protect revenue and tackle error and fraud,” said National Audit Office head Amyas Morse in his overview of the accounts.
From April 2019, it will be mandatory for ALL VAT registered businesses to be using MTD compliant accounting software.
Looking at the current state of play, this will be impossible to achieve and poses a clear threat to the continuity of VAT income to the Government, especially as there will be much confusion anyway as we leave the EU at that same time.
I cannot see the April 2019 being a realistic date to try and introduce MTD for VAT and fully expect this to be deferred to 2020 or later.
"For the 17th year in a row, HMRC’s accounts were qualified due to material errors and fraud ...." HMRC and shareholders would find this completely unacceptable if we were talking about a taxpayer and not HMRC so why do we taxpayers "accept" it of HMRC. Heads should roll at HMRC for their inability to get it under control. HMRC are a disgrace and a national embarrassment. I wonder if other national tax authorities are as rubbish.
Do you actually understand what "error and fraud" means here?
To be classified as fraud, HMRC needs to have found evidence that the claimant deliberately set out to misrepresent their circumstances to get money to which they are not entitled (e.g. claiming for a child that does not exist). Error on the other hand covers cases where there is no evidence of the claimant deliberately trying to deceive HMRC, including cases where a claimant inadvertently overclaims because they simply provided HMRC with the wrong information. And this could happen because tax credits are based on household circumstances (and so can be claimed jointly by a couple or by singles) and entitlement is based lots of different factors, e.g. on age, income, hours worked, number and age of children, childcare costs and disabilities.
But it could also cover a situation where the correct information has been provided but this information has been incorrectly processed by HMRC. It's this that MIGHT justify (some of) your angst but ONLY if it is anything more than a negligible contribution to the overall fraud and error rate, which I think is about 5.5% according to the report.
So does it make any more than a negligible contribution?
eek 5.5%....looks small doesn't it...but if you are multiplying it by a big number....it makes well erm a big number.