Britain's Great Tax Screw Up.

As you may have heard the UK has some financial problems. It came as no surprise then when on September 4th the UK tax office, known as Her Majesties Revenue and Customs (HMRC), decided it had been incorrectly collecting income tax through the Pay As You Earn (PAYE) system. Apparently some people will have to pay more tax while some will get a rebate. However the net effect is that HMRC will collect a extra £200million.

I suspect those who have been selected to pay the extra tax have been selected because they're the most likely to pay up with out argument. However if I was to receive one of these tax bills I would check it very carefully. If it is more then two years old HMRC have no legal right to collect. Also because it is PAYE the chances are that any mistake has been made by the employer rather then the employee.

Edited to Add. PAYE is income tax taken from an employees wages at source by the employer. The argument that HMRC is using is that some employers have been using the wrong tax code. Provided the employee has given their employer the tax code given to them by HRMC they are not liable for the mistake.