Dr Susan Treagus, a newly widowed woman from Manchester, has criticised HMRC after an automated system incorrectly calculated her income, nearly halving her pension. Following her husband's death in March, she used the Tell Us Once service to notify HMRC. In April, she received two tax code notifications; the second, triggered by her bereavement, added £62,000 to her pension income, pushing it into a higher tax bracket.
Dr Treagus discovered the error when her occupational pension payments dropped significantly in May and June. Upon contacting HMRC, she was told a computer had calculated her annual income by reviewing electronic transfers in and out of her bank account in February and March, then multiplying by 12. This suggested she earned over £100,000, despite the large payments being from savings used for funeral costs and care home fees.
She expressed shock that HMRC could impose such a tax increase without human oversight, stating: 'If this is not an example of everything that is wrong with AI, algorithms and leaving matters to bots... I don’t know what is.' She noted that only her own vigilance prevented the error from persisting, and questioned how less numerate individuals would cope.
Separately, a reader described how his car insurance premium rose after his wife's death. To satisfy the insurer's algorithm, he added his son—who lives 100 miles away and rarely travels with him—to the policy, which resolved the issue. He called the situation 'nonsensical' but effective.
