Elevate your HMRC complaint

I want to complain

It’s fair to say that at one time or another most of us have wanted to complain about the tax we pay. However, not liking your tax bill isn’t grounds for complaining to HMRC. Such action is reserved for disagreements about tax law, how HMRC’s policy has been applied or just the standard of its service. Disputes in the first category are resolved by negotiation with HMRC or through the courts. Unresolved complaints in the other categories can be settled by the Adjudicator’s Office (AO). In practice, only ask the AO to get involved if HMRC’s actions have resulted in additional tax or you’re seeking compensation, e.g. for costs incurred because of HMRC’s poor service. In other words, if there’s a financial incentive.

Going through the motions

The AO will only review your case if the circumstances are right. You can’t ask for a review just because you’ve hit a brick wall in discussions with HMRC. There’s a strict protocol that must be followed, and this is where it can get tricky.

AO protocol

Before turning to the AO you must go through two levels of HMRC’s internal complaint or review process, or a combination of both.

Example 1. If you’re complaining about poor HMRC service you can make an initial (so-called Tier-1) complaint. If that doesn’t resolve the issue you can ask HMRC to reconsider. This is a Tier-2 complaint.

Example 2. If you’re complaining about HMRC not applying one of its policies or concessions to your tax affairs you can make a Tier-1 complaint or request a first review. A review would usually be the best way to go here. If that fails you can ask for a further review.

In both examples the next step is to make a complaint to the AO. The process is simple and can be done online.

Trouble with the protocol

The path to the AO appears straightforward but you can get side-tracked or tripped up by HMRC along the way. For example, HMRC must register your first and second complaints/reviews on its system. If it doesn’t, when the AO checks HMRC’s records, it will appear that the protocol has not been met and it will refuse your request. It will ask you to make a Tier-2 complaint/review to HMRC and then, if necessary, apply to the AO again.

We’ve seen cases where taxpayers made up to four complaints or requests for review to HMRC but still did not reach the protocol threshold. This can cause disputes to run for many months or even years longer than they need to. The good news is that you can take simple steps to prevent this from happening to you. Always make your complaints or requests for reviews in writing.

Write clearly at the head of each letter that it’s a complaint/request for review. Don’t leave it up to HMRC to work out for itself based on the contents of your letter. Also, indicate whether you’re making a Tier-1 or Tier-2 complaint/request for review.