Contractors disadvantaged again by HMRC lack of resource and ill-informed staff

It is bad enough that HMRC’s own inability to programme their own systems to deal with their own rule change mean that we and our Contactor clients are hugely inconvenienced needing to file the majority of Contractors Self Assessments for 2016/17 on paper rather than electronically: but now we know even their own staff don’t appreciate the magnitude of the issue and its impact.

In the last 48 hours we have interacted with different HMRC departments and offices and have evidence that this is a shambolic mess!

Distrust

Since bringing this situation to our client’s attention, I am not surprised that some have contacted us, absolutely dumbfounded at the incompetence of HMRC.  This has not been helped by HMRC’s own staff not understanding the problem or not asking the right questions. Angry clients have called their local tax office only to be told by HMRC staff that Self Assessments can be filed online. They have then, understandably but incorrectly, assumed the problem is with us. I can only presume that HMRC staff have a) not been trained properly with the issues or b) did not ask the right questions of the caller to determine if dividend income was an issue. Whatever the reason for the poor advice, it is not helping us.  Please be assured we would far rather file returns electronically as the process is quicker, easier and more secure for all of us but right now for the majority of our clients we just can’t do this.

Wider Impact

We have already advised that clients expecting refunds should file early as we suspected there would be delays in processing. We now have evidence of severe delays.

Three weeks ago we filed a 2016/17 self-assessment, on paper, for a client who is applying for a mortgage. Needing an SA302 to support the mortgage application, we checked our Agency portal to ensure that the return had been processed. On discovering that it hadn’t, we called HMRC and explained the urgency of the situation and the need for the return to be processed. We were politely informed that the current turnaround time for processing paper returns is….2 MONTHS! So only one month into the new tax year, and before the widespread need for paper returns has had time to bite, they are already behind. We can only imagine the time lag by the time we get to the paper filing deadline in October!

As far as our client’s mortgage was concerned, it really was a case of “not my problem” from HMRC. There is no fast track to processing the return, in any circumstance and no other solution or help was offered. We will have to wait and see what happens to the mortgage application, once the mortgage broker stops laughing! For the client it is added frustration in an already stressful period.

We fully expect this story to be echoed by hundreds of others in the coming months. We’ll do everything we can to assist, but the most useful advice we can offer is to act as early as possible to secure your place in the lengthening queue.

 

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