The number of controversial Accelerated Payment Notices HMRC admits it issued in error hits 6,000

Published on 25 April 2018

In total, HMRC has issued more than 79,000 APNs since their introduction in August 2014. Adam Craggs, Partner at RPC, says such high numbers of APNs being withdrawn raises questions over whether HMRC is exercising this draconian power with sufficient care.

Under the APN regime, HMRC can demand tax that it believes is owed without having to first establish that there is a tax liability before an independent Tax Tribunal or court. Taxpayers have only 90 days to pay the amount demanded in their APN with no right of appeal.

Many taxpayers face bankruptcy or having to conduct a fire sale of their home or other assets in order to raise sufficient funds to pay their APN.

RPC adds that it can be extremely difficult to get HMRC to accept that it has made a mistake in issuing an APN, putting some innocent businesses and individuals under intense financial and emotional stress when faced with what may be incorrect or unlawful tax demands.

APNs that have been withdrawn are likely to include cases where simple arithmetical miscalculations can be demonstrated, or where one of the necessary preconditions, which must be satisfied before HMRC can issue an APN, are not satisfied.

RPC says it is likely that many more APNs could have been issued incorrectly but have not been withdrawn, because errors have not been identified in what is a complex area of the law.

It advises that taxpayers should not simply assume an APN is correct – if they feel an APN has been issued incorrectly, they should consider seeking expert legal advice before paying the tax demanded by HMRC.

Adam Craggs adds: “APNs have always been controversial and these figures are going to do little to silence their critics or reassure taxpayers that HMRC is exercising its powers in a proportionate and lawful manner.”

“Clearly, HMRC doesn’t always get it right so businesses and individuals who feel they’ve been issued with an APN in error should not simply feel they have to accept it and pay up.”