HMRC is under pressure to extend the self-assessment deadline as helpline delays threaten to trigger thousands of late penalties.
Taxpayers ringing the self-assessment phone line on Tuesday were told they could expect to wait for 40 minutes before getting through to an adviser. Many were calling for urgent help with their tax return which must be submitted by January 31 to avoid late penalties.
John O’Connell, chief executive of the Taxpayers’ Alliance, said: “Due to the tax office’s phone delays many may end up being fined for missing tomorrow’s deadline.
“HMRC should recognise the pressures on their systems and extend the deadline for taxpayers that need help.”
HMRC’s typical average wait time is around 24 minutes.
Taxpayers who miss the deadline risk an automatic £100 late filing penalty, with additional penalties for paying outstanding taxes after the deadline.
There is a 5pc penalty on unpaid tax at 30 days, six months and 12 months. Interest, currently at 7.75pc, will also be charged on any late payments of tax.
Sir Jacob Rees-Mogg, the Conservative MP for North East Somerset, said: “No one should be fined for a fault that lies with the Government. It would be fundamentally unjust.”
It comes as thousands are forced to file self-assessments for the first time this year because of frozen income tax allowances.
These allowances usually rise in line with inflation but were frozen by Rishi Sunak in 2021 when he was Chancellor.
Tom Clougherty, executive director at the Institute of Economics Affairs, said that HMRC should grant penalty-free deadline extensions to people caught out.
Mr Clougherty said: “One of the hidden costs of fiscal drag is more people having to trouble themselves filing tax returns.
“I think that a punitive approach from HMRC would be inappropriate in the circumstances. I hope that they will be generous, especially with people who have just crossed the boundary without realising it.
“Clearly, that is not any attempt to evade taxes or pay less tax than they ought to. That is just an honest mistake which is arising from the government freezing tax thresholds to a great degree.”
Taxpayers posted on X, formerly Twitter, saying they needed help with their tax return but had been unable to speak to an adviser on the phone.
One social media user wrote on HMRC’s Customer Support page: “I’ve just been on hold for 53 minutes and the minute you answer you hang up on me! How am I supposed to get an issue sorted with service like this?”
At the end of last year HMRC revealed it would only allow “priority” callers and the “digitally excluded” to speak to a tax adviser on the phone from December 11 until the annual tax return deadline. The move is part of the tax office’s plan to push more taxpayers to use its digital services instead of the phone lines.
Nimesh Shah, chief executive of accountancy firm Blick Rothenberg, said customer service levels were the “worst” he had ever seen.
“I’d be amazed if anyone ringing up can get through in the next 24 hours,” he said.
Harriett Baldwin, chair of the Treasury Committee, an influential group of MPs, said: “People calling the helpline are doing so because they are trying to get their taxes right.
“When we were told there were plans to reduce the phone line capacity to focus on priority callers, I was concerned that this might cause serious issues for well-meaning taxpayers who just want to get answers.
“We will be writing to HMRC to see what impact these operational changes have had on waiting times and late fines.”
HMRC customer service staff numbers dropped from 20,139 to 18,996 in 2023, according to data obtained in a freedom of information request by tax firm RSM.
HMRC said on Tuesday its customer services staff no longer work exclusively in call centres. “We’ve moved to a flexible model where our customer advisers can operate between different channels like webchat, post and calls, as this allows us to react to peaks in demand and deploy staff more efficiently.”
Chris Etherington, of RSM, said: “There is clearly a focus on HMRC trying to maximise the output and efficiency of the resources available to them. However, there is a tipping point where a lack of resources can be demoralising for staff being put under increasing pressure, ultimately leading to more departures.”
Taxpayers have been affected by various customer service issues at the tax authority over the last 18 months. HMRC was grilled by MPs last year after it gave taxpayers just two working days’ notice before closing its self-assessment helpline over the summer.
Helen Thornley, of The Association of Taxation Technicians, said: “These delays form part of a wider picture of concern within the profession that HMRC is under-resourced to deal with all that is being asked of it.
“We worry that HMRC’s desire to push taxpayers towards digital resources will mean some people are left behind, and the services available to taxpayers and professional advisers via digital channels are too often incomplete, disjointed, and poorly designed even for those who can go digital.”
Caroline Miskin, of the Institute of Chartered Accountants in England and Wales, a trade body, said: “Demand is increasing as more taxpayers are drawn into self assessment because of the freezing of tax bands and allowances. This has created compounding pressures of higher demand and a more restricted service offering from HMRC.
“Waiting times are much too long.”
A spokesman for HMRC said taxpayers have 10 months after the end of the tax year to file their returns online.
He said: “Our online services and phone lines are operating as normal, with filing going well ahead of the self-assessment deadline.
“Customers are successfully using our digital services to get the help they need as this is the quickest and easiest way for most, saving people having to wait on the phone. This frees up our expert advisors to help people with urgent and more complicated queries as well as help the small number unable to access our online services.
“Millions of people already sort their taxes online, with more than 80pc satisfied with their experience.”
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2024-01-30 18:43:00Z
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