Tax: Complaints about HMRC

HMRC complaints
Donald-Drysdale By Donald Drysdale for ICAS

11 August 2017

Donald Drysdale considers the number of complaints made about HMRC and how they are resolved.

Complaints about HMRC

On 13 July 2017, HMRC published their latest Annual Report. In 2016/17 they received some 50 million telephone calls and 12 million letters, and were on the receiving end of 77,279 new complaints — a reduction of 4% compared with the previous year. These were complaints regarding the way taxes were administered by HMRC, as distinct from technical disagreements about tax decisions and penalties.

HMRC resolved 98.6% of those complaints within the department, fully or ‘partially’ (sic) upholding 49.4% of them. In around 1.4% of the cases, the complainants were dissatisfied with the outcome and referred the matter to the Adjudicator for independent consideration.

The Adjudicator

The Adjudicator’s Office was established in 1993 to act as a fair and unbiased referee, looking into complaints about HMRC and the Valuation Office Agency (VOA). It provides a free and impartial service, but can only consider certain types of complaint. The current Adjudicator, Helen Megarry, was appointed in April 2016, so 2016/17 was her first year in post.

On 13 July the Adjudicator’s Office published its 24th Annual Report. In 2016/17 the Office received 1,116 complaints about HMRC and 26 about the VOA. Of complaints made about HMRC, 41% were upheld – compared with 85% in 2014/15 and 73% in 2015/16. Of those made about the VOA, only 10% were upheld.

Anyone dissatisfied with a decision by the Adjudicator may refer the matter on to the Parliamentary Ombudsman via their MP.

The Ombudsman

The Ombudsman, Rob Behrens, succeeded Dame Julie Mellor on 6 April 2017. As Ombudsman, he is accountable to Parliament through the House of Commons Public Administration and Constitutional Affairs Committee. His role is to make final, independent and impartial decisions on complaints which UK government departments and some other UK public organisations have failed to resolve.

On 18 July the new Ombudsman published his Annual Report and Accounts 2016/17, marking 50 years since the service was established.

Of greater relevance to this article is his predecessor’s Ombudsman’s report of 21 December 2016 about complaints her office handled and investigations they undertook during 2015/16. The report on complaints handled in 2016/17 is not yet available.

The Ombudsman rated HMRC highly, noting that they stood out as an organisation with effective second-tier complaint systems in place – meaning that complaints were likely to be resolved before they reached the Ombudsman service.

Of the 88 complaints about HMRC that the Ombudsman investigated in 2015/16, only nine (10%) were upheld. By comparison, the Ombudsman upheld 35% of the complaints against the Ministry of Justice, 39% of those against the Department of Work and Pensions and 75% of those against the Home Office.

HMRC’s improved performance

At 77,279, the volume of complaints about HMRC in 2016/17 remains high in absolute terms – a clear sign of an organisation where all is not well. However, at 49.4% the proportion of these upheld by HMRC is substantial – a welcome indication that HMRC are often willing and able to recognise and remedy their mistakes.

There has been no significant change in the number of complaints about HMRC referred to the Adjudicator or the Ombudsman. Nonetheless, the reduction in the proportion of complaints upheld by the Adjudicator is astonishing – falling from 85% to 73% and then to 41% in the space of only two years.

Assuming that the Adjudicator’s Office is as impartial as ever, the sharp drop in complaints upheld against HMRC may suggest that the tax authority’s own complaint-handling procedures have produced more acceptable results.

The National Audit Office (NAO) report of 14 July on HMRC’s latest Annual Report made no reference to complaints about HMRC. However, it observed that in 2016/17 HMRC improved their customer service performance significantly, achieving their best performance in the past five years against key targets.

The importance of impartiality

A pedantic point, I know. But it’s a pity that both HMRC and the Adjudicator’s Office cast a shadow of doubt over their procedures by referring to complaints that were ‘partially upheld.’ They should of course banish any suggestion that there was a lack of impartiality, and acknowledge instead that those complaints were ‘partly upheld.’

How to submit a complaint

Through 2016/17 HMRC piloted an online complaints form for personal taxpayers. Following positive feedback, they plan to increase its availability during 2017/18 – for example, for use by those complaining as a tax agent or a business.

Further details about how complaints can be made to HMRC and how such complaints are handled can be found here on HMRC’s website.

If a complaint has been made to HMRC and the complainant feels it is not being progressed satisfactorily, another route available is to make use of HMRC’s Alternative Dispute Resolution (ADR) procedure. This provides an opportunity for a third party to act as a mediator.

Article supplied by Taxing Words Ltd

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  • Tax

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