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Kitten tangled up in wires | AccountingWEB | No solution for HMRC’s voluntary NIC payments error
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No adequate solution for HMRC’s voluntary NIC payments error

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Despite professional bodies pressing HMRC to solve its national insurance contribution payments error without the need for individual phone calls to be made, it has been unable to do so.

2nd Jul 2024
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HMRC has been blasted for being unable to fix a problem “of its own making” after providing an update on its national insurance contribution (NIC) payments mistake.

As reported in April, the department was found to have wrongly refunded some voluntary Class 2 NIC payments to taxpayers.

Long-standing issue

The collection of such contributions has been an issue since HMRC started doing so through self assessment (SA).

The most recent hiccup was payment files that should have been processed on 2 February 2024 and were not done until 5 February 2024, meaning affected taxpayers and their agents have received a SA tax calculation with a message saying that payment has been made late and the voluntary Class 2 NIC charge has been reversed.

This has led to a refund of Class 2 NICs being issued or not receiving a refund of Class 2 NICs but the payment is showing as a credit in SA or has been allocated to a different SA liability.

The Institute of Chartered Accountants in England and Wales (ICAEW) has noted that professional bodies have been “pushing HMRC for a solution” that would fix the problem without the need for each case to make an individual phone call.

However, HMRC has now advised that it is unable to do so.

Very disappointing

Taxpayers are able to check either their online account or the HMRC app to see if their Class 2 NIC for 2022/23 is on their NIC record but if the year is not showing as full, or they’re unable to access their account, they will need to phone the national insurance helpline.

Caroline Miskin, senior technical manager of digital taxation, said it is “very disappointing that HMRC is not able to fix this problem that is of its own making”.

“This will generate additional demand on HMRC helplines that are already not able to cope,” she added.

“Perhaps an even greater concern is that taxpayers (especially those who are unrepresented) will not follow this through and will lose out. They may only discover the problem on retirement when they find that there is a shortfall in their state retirement pension.

“It highlights the importance of everyone checking that their national insurance record is correct,” said Miskin.

Replies (7)

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By FactChecker
02nd Jul 2024 12:44

So we have a new addition to the lexicon of the panjandrums who sit in power over us (in their eyes at least).

After "I was not made aware .." and "I don't remember .." (c) the PO Enquiry,
we now have "We are unable .." as a fait accompli/no-appeal abnegation of responsibility!

Wonder how that would go down as a RESPONSE to any HMRC request/enquiry?

Thanks (4)
Rob Swan
By Rob Swan
02nd Jul 2024 13:58

Maybe we should just ask "What CAN HMRC actually do? (without [***] it up!)"

I suspect their response would be an awkward silence, some hurried shuffling of papers, some "Er.... Well..... We......." and a "We'll get back to you on that one.". Which, of course, they probably never would.

Thanks (4)
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By Tom+Cross
02nd Jul 2024 16:02

Like Dr John Reid said, years ago, about the Home Office; “unfit for purpose”.
And the rest of the civil service. However, don’t expect change, when Sir Starmer takes office. He once was, one of their number, hence the Sir! Don’t make me laugh. Everyone else does, when the UK is mentioned. The basket case of Europe and beyond.

Thanks (1)
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By D Rixson
03rd Jul 2024 09:10

It's also frustrating that agents can't see their clients National Insurance record.

Thanks (4)
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By AngieH
03rd Jul 2024 09:13

But let's give a knighthood to the man who is in charge of the mess that is HMRC !!! Paula Vennells again perhaps?

Thanks (5)
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By D V Fields
03rd Jul 2024 09:51

“However, HMRC has now advised that it is unable to do so.”

The programmers could possibly follow a specification to make the change needed. However HMRC have no idea what a specification is let alone how to write one or even what they want it to do. Probably best they leave alone. Shame they didn’t in the first place.

Thanks (2)
Replying to D V Fields:
Rob Swan
By Rob Swan
03rd Jul 2024 11:21

The term is "technical debt" - when the job wasn't done or documented properly in the first place - it never is! - and nobody dare touch the code because it's an almighty mess and it would be easier to start from scratch than work out what's going on and fix it. It's entirely possible - and highly likely - that they don't even have the source code.

This is one huge problem with 'contracting out' and using the private sector for government systems. Departments have no control over the things which really matter when you need to maintain a critical system suddenly vanish - source code, documentation, skills, knowledge, etc. They have no in-house skills and the moment there's a problem they - and us - are in the [***]! Even if they retain the consulting/contracting company the 'expertise' will disappear the moment there's any sign of trouble or the job gets 'boring'.

Thanks (1)