HMRC backlog has workers waiting months for tax refunds worth thousands

Huge delays at HM Revenue and Customs (HMRC) are causing people to wait months for money they are owed. A recent investigation made by a national newspaper discovered that HMRC staff could take as long as up to ten months to carry out tasks that should be done in 15 days.

It also uncovered a series of mistakes, including an error that saw a business being chased for money it didn't owe and targets were being missed in 14 out of 27 different service areas.

This included tax penalty appeals, payment of self-assessment refunds and marriage tax allowance claims where you’re able to transfer £1,260 of your own personal allowance to your husband, wife or civil partner. Plus you can also backdate your claim if you’re eligible. For more information on marriage tax allowance see our full guides.

There are suspicions that the HMRC's working from home tax policy, which was introduced at the start of lockdown and enables you to claim back on increased utility costs such as heat or electricity used at that particular time, are the cause of the problems. The report states that, until the end of 2021, most staff would only be in the office one day of the week.

It’s estimated that around three million people made a working from home tax claim in the 2020-21 tax year. Claims can be also backdated which means that you might be eligible to receive up to £280 tax relief if you claim both last and this year’s tax year. Read more about working from tax relief on our category page.

In 2020, there was also a redundancy programme where local offices were replaced with regional hubs, and this has been cited as a factor as well.

However, the HMRC strongly denied that staff working remotely were responsible for any issues to their service. The report stated in October, more than 16,000 staff who had worked from home during the pandemic were now back in office. However, overall, staff were still working from home an average of four days a week.

Documents would be scanned by workers in offices so those based at home could process them. The report said that targets had slipped considerably during the pandemic as staff were redeployed to help with the Covid response but maintained that overall staffing had increased over the past six years.

These inconsistencies have been the result of people missing out on thousands who have claimed marriage tax allowance, working from home tax and tax penalty appeals. HMRC have said they would consider refunding any reasonable mistakes caused, so receipts will need to be kept.

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