HMRC Tax Return Backlog Nears 12m

HM Revenue and Customs (HMRC) has yet to check the accuracy of tax payments from 11.5 million people in the "Pay As You Earn (PAYE)" tax system from 2005-06.

The figure means that 32% of people in the PAYE system have still had not had their payments checked, more than 12 months after the tax year ended.

It has also been revealed that 11 million PAYE forms from employers could not be matched to workers' records.

But a Revenue spokesman said the situation was now improving.

"Most of these people - at least 75% - would still have paid the right amount of tax," he said.

"Many more migrant workers, a more mobile workforce and more people with multiple employments has meant that the number of records that have to be cleared each year has increased," said the spokesman.

"All forms for 2005-06 will be processed by October this year."

National Audit Office reported earlier this month that £125m in income tax went uncollected in the past financial year, while £157m was also overpaid.

At the time, NAO chief Sir John Bourn blamed the Revenue's IT systems for the problem. "HMRC's Computer Systems are no longer well-suited to the efficient administration of income tax especially where people have more than one job or change jobs frequently," he said.

The NAO put the number of "open cases" at the Revenue at 13 million, as of March 2007, and noted the Revenue's plan to reduce this to 10.5 million by March next year.

However it did not highlight the fact the current cases formed a backlog that was a year old.

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