HMRC - "That is our policy, pay up"

As some of you will already know, nothing gets my back up as much as a belief that a major
department of government are ‘getting it wrong’; especially if I think they are mistreating
ordinary people.

My client Jo is an employee with a few expenses (previously unclaimed) but came to me with a
letter from HMRC Tax Credits reclaiming £800 paid in the few months before she was made
bankrupt. This made no sense to me and to cut a long story short we exchanged quite a few letters
(keeping Jo’s MP firmly in the loop) which went:

HMRC- “That is our policy, pay up".

Phil Needham – “ Your power does not derive from your policy, it derives from Parliament, via
legislation, show me where this power, which overrides the insolvency act, is in the legislation and
I will advise the client to pay up. Otherwise, either go away or take us to court so my client can get
a judge to decide”.

Repeat, repeat..…

Finally, Jo has just had a letter admitting the ‘policy’ adopted by HMRC was in error and volunteering
compensation. It is a sad case of a department set up to administer social security, persecuting the
financially weakest members of society completely outside of their powers!