HMRC set to repay millions in taxes

Date: 29th June 2011

HM Revenue & Customs (HMRC) could be faced with a refund bill running into millions of pounds due to incorrect tax information.

The BBC has reported that letters will be sent to 4.7 million taxpayers, informing them that they paid too much or too little tax in 2010.

It comes as HMRC carried out its yearly reconciliation exercise.

According to the news provider, up to 3.5 million people stand to receive a rebate of around £340, while a further 1.2 million are expected to owe between £500 and £600.

John Whiting, tax policy director at the Chartered Institute of Taxation, told the BBC: "PAYE sorts most things for most people, but end of year reconciliations are always going to be needed to finalise the tax situation of a lot of people.

"People need to take an interest in their tax situation, especially if they are moving in and out of work or have multiple or erratic sources of income."

Posted by Emily Smith