Tax Refund Overpayment Revenue Mistake But They Are Blaming Me!

[paulgreen]

Yesterday I received a letter from Revenue saying that they had over paid me by what could be 10 grand back in 09 and it come to light because of a p35 form they had just got around to checking? i'll try and be brief

in 2008 i was made redundent and then retired early the firm who then paid my pension irish life then became for revenue purposes my employer, during the period Aug to Dec 08 they started to pay me tax refunds together with my pension each month now correct me if i'm wrong but the revenue must have authorised these as being due from my previous employment? because Irish life would have no idea.anyway i was a bit surprised and phoned irish life who said they couldn't help as it had come through the system I then phoned revenue who said ah sure your due them because you over paid.


Anyway left it at that then in Jan 09 i applied for top slicing because you cannot apply in the same year and low and behold got a refund

now revenue are say because i didn't say i had got those refunds on my tax return they incorrectly overpaid me top slicing but why should I ? they should know how much they have refunded also i don't recall there being any sections on the form 12 to indicate tax refunds.
From the wording of the revenue letter they are trying to make it my fault but its clearly there's now I'm the one to suffer, do I have any way of avoiding repayment?

 

[DB74]

Why should you avoid repayment. Just because it was Revenue's fault doesn't mean the tax isn't due back to them. I would contact them and insist that it was their fault and that you will pay them back but don't accept any interest charges from them.

 

[ali]

Why should you avoid repayment. Just because it was Revenue's fault doesn't mean the tax isn't due back to them. I would contact them and insist that it was their fault and that you will pay them back but don't accept any interest charges from them.

I don't accept this. I have seen this argument made on many posts and it doesn't always make sense. Obviously everyone wants to be compliant and pay their debts and not avoid their responsibilities. However; when this repayment was made to op he questioned it and was reassured that it was correct.

He may have made financial decisions based on the receipt of this money, something he would not have done had this payment not been made to him. He may have run out to buy a sports car or put the cash on a horse (or perhaps more reasonably bought a wide screen tv or new couch) which he was quite entitled to do if it was a legitimate payment. Either way it is unlikely that he banked it just in case it was required later. If he did, I would say just give it back.

He is now being penalised because of someone else's mistake. He may now be in a considerably worse financial position and is expected to repay money which is not in his possesion.

Yes the money is due back but it is unreasonable not to accept that the original error has consequences for the payee and IMO the revenue should take that into account by perhaps agreeing a lower settlement and on a repayment schedule.

A.

 

[papervalue]

He is now being penalised because of someone else's mistake. He may now be in a considerably worse financial position and is expected to repay money which is not in his possesion.

Yes the money is due back but it is unreasonable not to accept that the original error has consequences for the payee and IMO the revenue should take that into account by perhaps agreeing a lower settlement and on a repayment schedule.



In regard to above quote



If it is a mistake on Revenue part, It is virtually immpossible to link it back to some one in Revenue Office. Ringing up and trying to trace who made mistake is nearly a wate of time as no one their will take responsibility or in other cases it is a lack of training they virtually close ranks.

I agree it is re-payable and should be repay but with nil interest.

Off the point a bit some staff on revenue phones answering a query a lot of time query could be beyond them. One day you might get one answer and the following day a different answer. I would check eveything revenue issues in regard to demands/assessments etc as you be suprised bythe amount of errors made on basic items and not following instruction in regard offsets. If unsure yourself ask someone working in accountancy to review if you dont have an accountant.

 

[T McGibney]

In general, I find that the Revenue approach to top-slicing relief computations leaves a lot to be desired. Different Revenue officials seem to follow different procedures in calculating refunds and in my experience some officials are reluctant to provide the taxpayer or their agent with a copy of their calculations.

 

[Joe_90]

I imagine that you sent your P45 to Irish Life and they used this information to compute how much tax you should pay each month. If you were not using your entire standard rate band then this would result in a refund of the tax suffered in the previous employment.
BUT this should balance itself out in that your P60 gross pay and tax paid should be correct. Refunds from Irish Life are contained within these figures.
So you sent in your P60 for the year to Taxes? and applied for TSR, the refund you received was higher than the amount you expected?
Have revenue issued you with a new balancing statement or just a letter.

 

[papervalue]

In a case like this It is hard to comment because we might not have 100% of the facts. It is easier to comment when you have copy of P45 first employer P60 Pension second job etc and see tax credits/bands on each

In cases like this it is up to Individual person to decide where your tax credits/bands are divided.

The main thing to keep in mind is that any over/underpayment comes to light when he files his tax return.

I think he be better off to get all documents and briefly review with someone with accounts experience who knows what they are talking about and can see the documents in front of them and how the error occurred.

It sounds like no matter what approach is taken the money is due. May want to get an understanding so that it does not happen again

 

[DB74]

Yes the money is due back but it is unreasonable not to accept that the original error has consequences for the payee and IMO the revenue should take that into account by perhaps agreeing a lower settlement and on a repayment schedule.

I don't think the OP should pay it back in one lump sum, nor do I believe that the payment should be reduced or written off altogether, which is what the OP was suggesting.

IMO it should be paid back over a reasonable period of time, depending on the amounts that the OP can afford each month. Revenue will attempt to bully you into paying over 12 months and/or also try to charge interest (in my experience) but, as I already suggested, don't let them bully you and insist that it was their fault, you have no problem paying it back but that it won't be in one lump sum.

 

[Graham_07]

in 2008 i was made redundent and then retired early the firm who then paid my pension irish life then became for revenue purposes my employer, during the period Aug to Dec 08 they started to pay me tax refunds together with my pension each month now correct me if i'm wrong but the revenue must have authorised these as being due from my previous employment? because Irish life would have no idea.anyway i was a bit surprised and phoned irish life who said they couldn't help as it had come through the system I then phoned revenue who said ah sure your due them because you over paid.

Just looking at this, when the OP left work, presumably their P45 went into the pension company. The pension company would have been issued a new TCC ( probably on a cumulative basis) and assuming that pension is less than the pay they were previously on, refunds could easily have issued if income dropped below their SRCOP. The Revenue would not have known about the income change as it was still during the course of the tax year. So you get to year end and tax paid for the year has effectively been reduced to that which probably ought to have been paid, leaving less scope for refund after year end.

Jan 09 apply for TSR and at that point no returns by employers for 2008 would be on file, not until at least mid-end February anyways. So again, Revenue do not have all the facts. The correct figures eventually go on record and an underpayment arises.

I am not defending Revenue, just that sometimes the timing of things means that people are not in possession of all the correct data.

I would agree that since it is a PAYE matter, repayment of the tax to Revenue should at least be over a longer period than 12 months, I'd go for three years. Also no interest at all should be entertained.