‘I overpaid £7,000 in tax – but my refund never arrived’
You have faced a particularly taxing time with HM Revenue & Customs, I have to say. It must have felt like groundhog day being told your refund had been paid to you time and again, only for it never to appear.
I asked the tax office to put an end to your misery, since it had been a year since you were told the £7,310 you were owed would be sent to your bank account. Where was your money? I waited eight days to find out.
The tax people said it took some digging to get to the bottom of your case but it finally discovered that each time an attempt was made to pay the refund into your Yorkshire Building Society account, using the Bacs payment system, it was not accepted.
After my intervention HMRC tried a different approach and issued the payment via the Chaps system. Hey presto, your money finally landed in your account. It defies belief that you were not told of the transfer problems sooner.
It seems to me that no one took the time, despite your protests, to find out why your payment was not being accepted or to use some common sense and get the money to you by other means. HMRC told me it was sorry you had had to wait and blamed “technical problems”, which it said had now been sorted out.
It appears the problem arose because Yorkshire Building Society, and I assume other building societies, requires not only a six-digit sort code and eight-digit account number to receive a payment but also the “roll” number – a 10-digit reference number used by building societies but not banks.
According to YBS, payments made via Chaps allow more information to be captured. This means extra details such as names, addresses and references can be quoted, allowing accounts to be more easily identified on receipt of the payment.
Payments made through Bacs do not include the same level of detail, so it is not as easy to allocate the funds if some information is missing. YBS said it was not aware of any repeated issues allocating payments from HMRC to customers’ accounts. You told me its explanation made sense as the refund request forms you completed did not contain a space for a roll number.
I checked online and, like you, did not see a roll number option on the HMRC refund form I downloaded. Let’s hope HMRC will update this paperwork to prevent others facing the same brick wall in getting back overpayments.
When I caught up with you recently you confirmed that you had finally received your payment, which, with interest added, came to £7,327. HMRC also sent you £30 “to add weight” to its apology for the difficulties. You thanked me for my involvement and said you believed that without it you would still be waiting.
You fell into this tax refund vortex in the first place because of the rules relating to pension fund withdrawals. If a pension company does not have details of your overall income, an emergency tax rate is charged when the first lump sum is withdrawn.