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bigduckontax, Accountant
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I have a 2011/13 self assessment tax dispute that is being

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I have a 2011/13 self assessment tax dispute that is being considered by HM Courts & Tribunals. HMRC have meantime offset the overpayment from my 2015/2016 against the amount they claim I owe for 2011/2013 and therefore withheld it from me.CAN I DEMEND THE PAYMENT TO ME OF THE OVER PAYMENT OF TAX FOR 2015/2016?Do HMRC have a right to withhold an overpayment from an unconnected year and an unconnected dispute until HMCTS has reached a decision?Yours,Henry Harington

Hello Harry, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.

Well you can try, but I suspect that HMRC will hold to their rather questionable action. In any event, it will all come out in the wash so to speak when the Tribunal make their decision known, hopefully in your favour.

I am sorry I cannot be more helpful here.

Customer: replied 1 year ago.
Hello Keith,Thank you for getting back to me so quickly but I am afraid telling me "you can try" doesn't answer the question viz do I have a right to the sum I overpaid in 2015/2016 or do HMRC have the right to withhold the sum in question?As background HMCTS have told me that they will not even start considering the dispute until the end of the year. And, as I said the overpayment in 2015/2016 is unconnected with the sum HMRC dispute.

I appreciate that, but there is some doubt as to whether their action, which might be considered unethical. is actually improper.

Customer: replied 1 year ago.
Let us assume you audit my accounts for the year 2012/2013 and we have a dispute over the bill that goes to court. Despite the ongoing dispute you audit my accounts for the year 2015/2016 and I inadvertently over pay you. You are not legally entitled to offset the overpayment in 2015/2016 against the sum you claim I owe for the 2012/2013 accounts.You have not given me a clear cut answer as to whether HMRC have a RIGHT to withhold my 2015/2016 over payment or whether I have a RIGHT to have it returned to me. Are there rules, laws, guidance, precedents that govern these situations or are you telling me that (as in most things) HMRC are above the law?

I would suggest that under those circumstances I am. However, as far as HMRC are concerned here is a comment from Accounting Web:

'Spoke to HMRC about why repayment was being witheld and was told that repayment would not be authorised until after the conclusion of an enquiry into the 2012 Partnership Tax Return. Can HMRC do this - presumably if a net payment was due it would have to be offset against the total tax payable. '

Customer: replied 1 year ago.
With the greatest of respect: I am asking (and paying) for YOUR opinion which, as yet, I do not feel I have received. The tax world is bound by a thicket of rules and regulations; are overpayments not governed by some rules or laws or are HMRC unilaterally and capriciously able to say, as they did in the Accounting Web example you quote, that "repayment would not be authorised until after conclusion of an enquiry into the 2012 Partnership Tax Return".I have spent two and a half years under investigation by HMRC who quote rules, laws and precedents at me left, right and centre. Yet I have been left with the impression that they make things up as they go along, without reference to the law or indeed justice, because they can and they are not answerable or, ironically, accountable, to anyone.I will try asking again: under what rules, laws, regulations, precedents or other codes can HMRC withhold an overpayment for a year unconnected with a dispute that is subject an HMCTS adjudication?

HNRC are well known for applying the law as they would like it to be not what it actually is. Perhaps this explains why that Department looses the majority of appeals.

Customer: replied 1 year ago.
I certainly hope they lose the appeal I have launched but in the time it takes them to do it they have my tax over payment and I want to know if there are rules governing these that I can point to in demanding that they pay it to me rather than offsetting it against the amount they claim, and I dispute, they are owed in a separate event.I want to approach them with your professional advice as to what rules, laws etc I can quote to require them to give me the overpayment. I would be grateful if you could specify what rules, laws etc apply to this area so the money can be in my bank account, not theirs!

In my opinion you are on a hiding to nothing here. If you ultimately win the case then HMRC will pay you interest on the tax withheld. HMRC will just prevaricate and say that in their opinion the tax treatment is correct.

I am rather surprised at you negative rating. You stated:

'Yet I have been left with the impression that they make things up as they go along, without reference to the law or indeed justice, because they can and they are not answerable or, ironically, accountable, to anyone.'

My answers merely confirmed this feeling.

I submit that the grading should be revised.

Customer: replied 1 year ago.
If you review our correspondence I asked the question about rules governing my situation a number of times. The answer should either have been "X,Y and Z" or "none". I am quite capable of making derogatory remarks about HMRC myself as well as consulting Accounting Web for opinion about the situation rather than fact.On a broader point, the accounting profession (other than those who work for Goldman Sachs) seem to be in thrall of HMRC bullying and intimidation.Henry Harington

That is as may be, I could not possibly comment. However, it is pertinent that these days HMRC loose most of the appeals taken against their decisions so the accounting profession is scarcely in their pocket!

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Thank you for your support.