Tax refund delay

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An increasing number of taxpayers are having to wait weeks or even months for refunds of overpaid tax, according to a Sheffield tax expert.

Elaine Skelton, head of personal tax at leading independent accountants Barber Harrison & Platt, says that in most instances claims have resulted from overpayments of income tax collected through the PAYE system and the delays are affecting both small and large claims.

“Making a claim for repayment through your tax return should result in an automatic refund being issued,” says Ms Skelton.

“As part of its commitment to combat fraud however, HMRC randomly selects individuals who are due repayments in order to carry out security checks. It is these security checks which have been blamed for causing the delays.

“The issue of delayed repayments is one that affects a wide cross section of people in South Yorkshire where the time taken to process the repayment is wholly disproportionate to the amount involved. The problem is compounded by the fact that HMRC pays just 0.5 per cent interest on its delayed repayments whereas it charges taxpayers 3 per cent on late payments of tax.”

Elaine Skelton says taxpayers still awaiting repayment eight weeks after submitting a tax return should contact their local tax office and consider complaining formally if the payment is further delayed.