HMRC not keen to learn

Adjudicator critical of Revenue’s unwillingness to learn from mistakes

The Tax Adjudicator’s report for the year ended 31st March 2015, whilst acknowledging that HMRC have made inroads in its complaints handling, also criticises the department for its “limited appetite for reflection and learning from their interaction with customers” and warns that “A failure to embed change may be costly” not only for them but also the taxpayer.

The role of The Adjudicator was created because HMRC, the Valuation Office Agency (VOA) and The Insolvency Service decided to introduce an independent tier of complaint handling, providing customers with a higher level of service and giving departments the opportunity to learn lessons and make improvements. Complaints can only be progressed to The Adjudicator after two attempts to resolve the matter with HMRC have failed.

While there are some areas that The Adjudicator cannot consider, such as disputes about aspects of departmental policy and matters of law, she can look at complaints about:

• mistakes;
• unreasonable delays;
• poor and misleading advice;
• inappropriate staff behaviour; and
• the use of discretion.

The Adjudicator is supported by staff in Derby, Liverpool, London, Newcastle and Nottingham, all of whom are specialist investigators that review each complaint and the evidence in detail.

During 2014-15 The Adjudicator received 1,044 new HMRC complaints, of which 85% were upheld either partially or substantially.

On occasion, The Adjudicator may recommend that HMRC pay a monetary sum to customers in recognition of the poor level of service they received, and any relevant costs. In the year to 31st March 2015 the following amounts of redress were recommended:

Failure by HMRC staff to consider the circumstances of vulnerable taxpayers, especially where the department had the opportunity to exercise discretion, was singled out for particular criticism by The Adjudicator. A number of case studies contained in the report go on to highlight this point.

Case Study – Failing to understand the taxpayer’s concerns

Issues

Ms A has severe dyslexia. Her correspondence from HMRC is sent by their Visually Impaired Media Unit in a larger font, but adapting correspondence causes delays. Ms A received a letter on 10th February relating to her Self-Assessment tax return, stating payment had to be made by 31st January. She telephoned HMRC to say the letter was received too late for the payment deadline and no payslip was enclosed. HMRC agreed to extend the deadline date but could not send her a payslip within the extended time limit, which meant interest and penalties would be charged. Ms A complained, as she felt this was her only way to resolve the situation.

Outcome

The Adjudicator upheld this complaint.

Ms A wanted to be treated like any other customer. HMRC acknowledged it was unacceptable that making a complaint was the only way to resolve her issue, and agreed this caused Ms A unnecessary worry and distress. Ms A was also upset by phrases used in HMRC’s report to The Adjudicator. The report mentioned a “bespoke service” and a “preferred method” of correspondence , and used the phrases “gesture of goodwill” and “great deal of sympathy”. Ms A felt HMRC had missed the point of her complaint and had no understanding of her requirements. She did not want a bespoke service and pointed out this was not her preferred method of contact, but a necessary adjustment for her dyslexia. The Adjudicator agreed with Ms A’s view and criticised HMRC for their lack of understanding.

Case study – Unacceptable customer service

Issues

Mr J complained about an HMRC Contact Centre adviser he claimed was aggressive, abusive and used profane language. He was passed to a manager who Mr J said told him he would call back after listening to the call, but that did not happen. Mr J requested a recording of the call but, because of a technical error, no recording was made. Mr J was very unhappy with HMRC’s handling of his complaint and requested compensation.

Outcome

The Adjudicator partly upheld this complaint. Although no recording of the call was made, the adviser admitted Mr J’s allegations were accurate. HMRC investigated the incident immediately and took disciplinary action, but failed to assure Mr J that they had taken his concerns seriously. HMRC’s response to a further letter from Mr J was sent outside of their published timescales. HMRC said they established “as a fact” that Mr J was not promised a call back by the manager but, when challenged, agreed this could not be proven without a recording of the call.

Although the amount of compensation Mr J requested was excessive, The Adjudicator considered HMRC’s offer of redress did not adequately reflect the full impact of their actions on Mr J. She recommended that HMRC increase the amount of redress to acknowledge this.

From my own experience of HMRC complaint handling, the department has a long way to go before it can truly say that it listens and understands the concerns of taxpayers, preferring instead to close ranks. Until they become more reasonable, then The Adjudicator will still be kept busy.

The full report can be found by clIcking HERE