Online tax system 'too risky' for the famous

The security of the online computer system used by more than three million people to file tax returns is in doubt after HM Revenue and Customs admitted it was not secure enough to be used by MPs, celebrities and the Royal Family.

Thousands of "high profile" people have been secretly barred from using the online tax return system amid concerns that their confidential details would be put at risk.

This provoked anger from consumer groups and accountants who said the same levels of security should be offered to all taxpayers regardless of their perceived fame.

HMRC was responsible for losing 25 million child benefit records and the latest admission will concern millions of people entrusting the online system with their confidential financial records.

From this year, anyone wishing to file a self-assessment tax return after October will have to do so online or face stiff penalties.