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Glasgow
+44 (0)141 221 2984

Edinburgh
+44 (0)131 225 6366

Stirling
+44 (0)1786 451745

Dumbarton
+44 (0)1389 765238

Hamilton
+44 (0)1698 459444

French Duncan

PAYE: The digital method is not foolproof

01 October 2014

The Government’s planned reforms as to how HMRC notifies taxpayers about changes to their tax code has drawn criticism from the LITRG. The group fears that a move to digital and telephone communications, coupled with not issuing notices directly to employees in some situations, will lead to more errors and erosion of taxpayers’ rights.

The Government’s proposal is to amend the law to allow the following changes to the PAYE system:

  • PAYE Notices of Coding may be issued electronically or conveyed by telephone.
  • In certain circumstances, a change in Tax Code could be notified to an employer without letting the employee know (changes will also apply to pensioners and pension providers in addition to employees and employers).
  • If HMRC choose, they may delay issuing a PAYE Notice of Coding by up to 30 days, notwithstanding that the individual’s employer will have been notified of the change and the employee’s tax deductions affected.

LITRG said that the Government’s proposals curtail employee’s rights and individual’s ability to understand and manage their own tax affairs. It also noted that giving people the option to interact with HMRC digitally should be an option which the individual chooses to take up. The LITRG further warned that removing the requirement to issue a Notice of Coding to some people, delaying its issue, and/or relegating its communication to a discussion by telephone, could have serious impacts for the low-paid and vulnerable.

If you think this may affect you or someone you know, please contact us by email or call 0141 221 2984.