Taxing procedure to recover money: Reorganisation has made it harder to secure refunds from the Revenue, writes Andrew Bibby

ACCORDING to the Inland Revenue, there is a fast and simple system for non-taxpayers to claim back tax deducted from their investment interest. 'Two ticks and your tax back' is the message of the Revenue's recent Taxback publicity campaign.

But according to John Pilsbury, a retired financial director from Wrexham, things can turn out very differently in practice. His wife, Gillian, has an income below her personal allowance, enabling her to reclaim about pounds 100 in tax deducted from her share dividends. Last year, the repayment came through promptly from the Pilsburys' local tax office.

This year, by contrast, nothing has been straightforward. 'A call to my tax office for a claim form was met with the suggestion that I should phone Belfast 'who deal with this now',' said Mr Pilsbury. Not fancying a long-distance call, he tried the Revenue's Taxback freephone service instead. He said the service was polite - but failed to send him the necessary form.

He phoned his local tax office in Wrexham a second time. This time, it sent him not the form he wanted but the Revenue's introductory booklet IR110. 'Inside was a form - to be used to request a claim form,' Mr Pilsbury said.

Nevertheless, the Pilsburys completed it and sent it as directed to St Austell in Cornwall. They then waited several weeks for something to happen.

Mr Pilsbury gave up waiting. Having found out from a friend that the form his wife required was called R40, he phoned the Wrexham office a third time, asked for the form by number and finally received one in the post. Not surprisingly, he is cynical about the Revenue's Taxback campaign.

'All in all, the effect has been to destroy the system which worked perfectly - for us at least - last year and to divert work to some far-flung corners of the kingdom for no good reason,' he said.

The Pilsburys appear to have suffered from the effects of a recent but little-publicised reorganisation by the Inland Revenue of the system for administering tax repayments to non-taxpayers. Last year, local tax offices in Wales (such as the one in Wrexham) dealt with claims from their area, while a network of 11 specialist offices elsewhere processed claims from England, Scotland and Northern Ireland.

'On the basis of the number of claims we received, we felt we could reduce the number of offices,' said Tim Morris, a Revenue spokesman. As from this tax year, therefore, all claims are dealt with by one of just five offices.

The Pilsburys must (as they were told) now deal with Belfast. The other four centres are at Bootle, Glenrothes, Leicester and St Austell.

'Obviously it has involved sending some people's files to different offices, but I'm not aware of any major problems,' said Mr Morris. He added that non-taxpayers who had claimed tax back previously should automatically have been sent a claim form for this year. It appears that Mrs Pilsbury slipped through the net for some reason.

However, the Inland Revenue is not exactly helping to speed up new claims. Leaflet IR110, A Guide for People with Savings, does not give the addresses of the five specialist offices. It merely instructs anyone requesting a claim form to write to the St Austell office.

St Austell is simply supposed to sort requests by location and forward most of them to the other four offices. Not surprisingly a backlog has developed. 'We've received 475,000 requests for information at St Austell since January. That's a large number to be dealing with,' said Mr Morris.

Perhaps the situation would have been more efficient if the Revenue had not precipitously closed many of the other specialist tax repayment offices. It has also, at least temporarily, withdrawn the Taxback freephone advice line.

Curiously, anyone ringing this line now is told by a recorded message to contact their local tax office - exactly the step that led to so much trouble for the Pilsburys.

(Photograph omitted)

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