A recent report into HMRC’s accounts for 2011 / 2012, carried out by the National Audit Office (NAO) revealed that HMRC overpaid between £2 and £2.5 billion in tax credits, and underpaid up to £290 million as a result of fraud and error.
It was stated within the report that over the last two years, there had been a ''large increase'' in the amount of tax which HMRC has decided not to pursue, including £756 million worth of income tax in 2011/ 2012 alone.
The chairman of the influential House of Commons Public Accounts Committee, Margaret Hodge, said she was shocked by ''the sheer scale of waste and mismanagement'' at HMRC.
Ms Hodge added: ''Sadly it is no surprise that the NAO has found substantial problems with the HMRC's accounts. This year has seen a litany of tax errors and scandals come to light with mistakes made at the most senior level from the permanent secretary for tax downwards.
''The sheer scale of waste and mismanagement at HMRC never ceases to shock me. Without even mentioning the tax gap, in 2011 / 2012 the department wrote off a staggering £5.2 billion of tax owed, overpaid nearly £2.5 billion in tax credits due to fraud and error and underpaid around £290 million.”
Ms Hodge went on to say of HMRC: ''In some areas the department is moving in the right direction and has made progress to implement improvement plans. But the department is still plagued by IT problems; limiting, for example, its ability to link together the debts owed by taxpayers across different tax streams.
''With its long history of large scale IT failures, the department needs to get a grip before it introduces its new real-time PAYE information systems and begins the high-risk move from tax credits to the universal credit.''
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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( 3 / 696 )Earlier this week, the Chancellor George Osborne, announced his plans to postpone the planned increase in fuel duty, for another six months.
It was widely expected that a three-pence increase in fuel duty would come into force this August; however in a move which is likely to cost over £500 million, the Chancellor has announced that this will now not happen.
Making the announcement in the House of Commons during a regular session of Treasury questions, Mr Osborne said: “We will stop any rise in fuel duty this August and freeze it for the rest of the year.
“We are on the side of the working families and businesses; and this will fuel our recovery at this very difficult time for the world.”
The Chancellor’s apparent U-turn is said to have surprised many MPs, and came hours after Labour had called for the rise to be scrapped.
Following the announcement, RAC Foundation’s director Professor Stephen Glaister, said: “This is good news for drivers and good news for the country.
“Given that tax makes up around sixty percent of the pump price, falls in the price of oil were only ever going to go so far in easing the financial burden on motorists.
“Road transport powers the nation's economy and it is welcome that the Chancellor recognises the huge pressures the country's thirty-five million drivers are under with transport being the biggest single area of household expenditure bar none.”
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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( 2.9 / 519 )New research from National Savings and Insurance (NS&I) has suggested that despite the rising living costs within the UK, Britons are still losing track of their savings.
The figures released from the research, suggest that 7.66 million people have investments and savings accounts which they have lost track of, with forty-percent of those savers not attempting to reunite themselves with their savings.
According to the research, of those who have lost touch with their savings and / or investments, more than a quarter have misplaced their original account details, whilst roughly the same amount struggle to remember all of the accounts they have previously opened.
It is estimated that most dormant savings accounts have only small sums in them – generally £50 or less. However there are some with tens of thousands of pounds just waiting for the rightful owner to show up; whilst it is also estimated that the banks alone have between £250 and £350 million sitting in their coffers waiting to be collected, which includes money left in accounts with around 500 banks over the past 100 or so years.
Retail customer director at NS&I, John Prout, said following the research: “Even small amounts of money can help with the costs of day to day living, so it's important people keep a track of their savings no matter how much they've previously put away.”
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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( 3 / 487 )The Office for National Statistics have revealed that the UK government borrowed more than expected in May, as tax receipts fell and spending rose.
Many analysts had expected May’s figure to be around the £14.8 billion mark; however, the latest figures from the Office for National Statistics have shown that public borrowing, excluding financial interventions such as bank bailouts, rose to £17.9 billion, compared with £15.2 billion the previous year.
In addition to the public borrowing hitting the £17.9 billion mark, Britain’s total public sector net debt, excluding financial sector interventions, rose to £1.013 trillion according to the Office for National Statistics; which is the equivalent to sixty-five percent of GDP – and a record for the month of May.
Following the release of the latest figures, it is feared that the weak figures could add to concerns over the health of the economy.
However, a spokesperson for the Treasury has said: “It is too early in the financial year to draw conclusions about the year as a whole, especially as today's public finances data include a number of one-off factors and temporary distortions.”
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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( 3 / 592 )Bank of England policymaker, David Miles, has said during an interview, that Britain needs a “substantial” amount of quantitative easing to jump-start its stalled economy.
Mr Miles was one of the policymakers alongside the Bank of England’s governor, Sir Mervyn King that voted for a third round of monetary stimulus; and he has again reiterated his support for a cash injection of at least £50 billion.
During his recent interview, Mr Miles is quoted as saying: “Do we need a more expansionary monetary policy? ‘Yes'. Should it be a substantial change in asset purchases? ‘Yes'.
“Is 50 billion pounds a substantial number? ‘Yes it is'. Could one know in advance what is exactly the right amount to do? ‘Absolutely not'.”
However, the Bank of England policymaker also said he could not “see any reason for thinking” that Britain’s recovery had been curtailed by the governments austerity measures, aimed at reducing the budget.
Mr Miles added: “A pretty substantial increase in the costs of funding for most UK banks then got passed through in the form of some increases in the costs of lending to corporates, and pretty clearly some increase in the costs of mortgages.
“That has been pretty unhelpful.”
Later this week a third revision of first quarter GDP is set to be released; which is widely expected to confirm that the UK is in a double-dip recession.
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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