City-based accountancy firm RSM has argued that errors in HMRC self-assessment software, which resulted in taxpayers having to reclaim overpayments, illustrate the need for independent quality control.
RSM’s senior tax partner George Bull said that recent errors in an online tax form provided by the ministry of justice for use in connection with divorces highlighted the need for outside scrutiny.
He said: “Sadly, but perhaps not surprisingly, this is not an isolated example of the problem. For example, recent errors in HMRC’s income tax self-assessment software meant that a number of clients overpaid tax which we subsequently had to reclaim from HMRC on their behalf.
“If the standard set by HMRC is incorrect, all tax returns software will be wrong in that respect. This suggests a fundamental gap in the quality control of the publication of online forms by the ministry of justice, by HMRC, and potentially by other government departments.
“This is a matter which requires attention now as citizens are increasingly required to complete online forms because no other means of ‘interaction’ with ‘government service providers’ is permitted.”
“This is a matter which requires attention now as citizens are increasingly required to complete online forms because no other means of ‘interaction’ with ‘government service providers’ is permitted” George BullMr Bull said an independent body was needed to check the logic in online forms produced by all government departments to ensure that they were correct and in line with the law.
He said: “All citizens, and the commercial software companies who are so important in helping citizens discharge their digital duties to the state, can then have confidence that they are working on firm foundations.”
But an HMRC spokesperson said self-assessment online was working well, and record numbers of taxpayers had already sent in their returns.
He said: “For a brief period last year the part of the self-assessment calculator which works out taxpayer-adjusted net income did not work as it should for a very small number of people.
“The problem has been fixed and no one will be disadvantaged.
“We very much regret any incovenience caused.”
RSM’s Mr Bull said that at the very least it should be possible to file a computation online, even if it does not accord with HMRC’s software, adding that the tax collectors would lose nothing because, if the tax figure were subsequently found to be wrong, interest would be recoverable.
He added that with HMRC driving the introduction of online digital accounts, a form of ‘real time information’ for the self-employed, and accelerated payment of income tax and capital gains taxes by many, it was essential that everybody can trust the software behind the tax calculations.
Adviser view
Robert Lewis, director of North Wales-based Heritage Financial Solutions, said: “Online errors in government forms are nothing new. We have helped dozens of clients over the years overcome issues they have found after an online form led them astray.
Mr Lewis said that just as his own firm runs all brochures and forms across its compliance department, a large part of HMRC’s role is to examine the documents, checking that logic prevails. He added that it made sense for government departments to adopt a sympathetic approach.
Steven Robinson, managing director at Bristol-based Clarke Robinson & Co, said that all software was subject to human error.
He added: “When computers become self-perpetuating and write their own software the errors will in time evolve out of the system. And by that time computers will not need us. In the meantime, having a standards or test board to make sure errors are reduced sounds like a good idea.”
ruth.gillbe@ft.com
