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HMRC staff pocket millions in erroneous overpayments

HMRC
HMRC

Tax inspectors have overpaid themselves more than £12m in the last 10 years, the Telegraph can reveal.

Some 250 employees at HM Revenue and Customs were mistakenly overpaid by more than £1,000 last year alone.

In total HMRC admits that its employees pocketed £12.6m over the past decade in erroneous overpayments that have to be clawed back by officials.

Figures obtained by The Telegraph showed a total of £12.3m has been paid back by staff, leaving a £300,000 shortfall.

Last year, HMRC were overpaid to the tune of £1.1m – with employees paying back just £900,000.

Many of the people who benefited from these extra payments were staff who left the organisation but messages did not get through to payroll to halt their salary payments.

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HMRC then has to launch what can be expensive and time-consuming work to ensure that all the overpaid salary is either paid back or deducted from future payments.

Jonathan Eida, researcher at the TaxPayers’ Alliance, said: “Taxpayers will be fuming that tax officials have been filling their pockets with more than they’re entitled to, even if it’s by accident.

“To overpay staff is a shocking error, but even worse is the fact that a lot of the cash hasn’t been clawed back. HMRC’s bosses shouldn’t rest until every last penny has been reclaimed.”

It comes amid mounting pressure on the tax office to reverse a decline in its customer service.

Earlier this year HMRC announced plans to permanently close its helplines for six months to push more people into using online services.

But after a public outcry the Chancellor Jeremy Hunt ordered HMRC to “pause” the scheme, which had been roundly criticised by all the political parties.

Last month it was also revealed that HMRC failed to answer almost a million calls in January as anxious taxpayers attempted to get advice before filing their self-assessment tax returns.

It published figures that showed 841,945 calls were “not handled” in the first month of the year and that caller wait times hit an average of 25 minutes.

Thousands of taxpayers end up in a last-minute rush to file their tax returns by the January 31 deadline in a bid to avoid a £100 fine.

It also emerged last year that two in five workers at regional HMRC centres did not go into the office at all in the year to March, while more than half the desks at its headquarters in Whitehall were empty as staff continued to work from home.

Sir Jacob Rees-Mogg, a former business secretary, said: “The lesson is obvious. HMRC is failing to deliver a service to the people and they’re not going into work.”

The tax office has repeatedly insisted its generous work-from-home policy is not to blame for the drop in its performance.

An HMRC spokesman said: “With a staff headcount of almost 67,500, we operate at a monthly payroll average accuracy rate of 99.54pc, which exceeds the corporate benchmark of 98pc.

“Our total paybill in the 2022-23 financial year was £2.449bn, which means that 0.05pc was incorrectly paid that year, and we have recovered over 84pc of that.

“Overpayments can occur for various reasons such as delay in reporting someone has left HMRC, breaking a part-year pay averaging contract, late notification of sick leave or a delay in reporting career breaks/maternity leave.

“We have robust processes in place for the recovery of over and underpayments and all staff are provided with guidance on the importance of checking the payment of their salary.”