More than 82,000 British households are facing unexpected tax demands from HM Revenue & Customs, with average bills reaching a staggering £3,700. The shocking crackdown targets individuals who received state pension or benefits without paying the required income tax.
Why Are Thousands Facing Retrospective Bills?
HMRC has launched an aggressive recovery operation focusing on taxpayers who failed to pay income tax on their state benefits during the 2022/23 tax year. The revenue body is using its controversial 'Section 684' powers to bypass standard time limits for tax collection, allowing them to pursue debts up to two decades old.
The Anatomy of the Tax Demands
According to recent data, HMRC has issued:
- 82,000 tax demands for the 2022/23 tax year alone
- Average bills of approximately £3,700 per household
- Targeted claims primarily against state pension and benefits recipients
Who Is Most Vulnerable?
Experts warn that pensioners and low-income families are particularly at risk. Many may have been unaware they needed to pay tax on their state benefits, especially if they had no other source of income requiring them to complete a tax return.
Legal Powers and Consumer Rights
HMRC is invoking extraordinary powers under Section 684 of the Income Tax (Earnings and Pensions) Act 2003. This legislation enables the tax authority to collect unpaid tax directly through tax codes or Self Assessment bills, even for years normally outside standard collection periods.
What Should Affected Households Do?
Tax specialists urge recipients of these demands not to panic but to act promptly:
- Verify the legitimacy of the demand through official HMRC channels
- Seek professional advice from qualified tax consultants
- Explore payment plan options if unable to settle the full amount immediately
- Check for potential overpayment claims that might offset the debt
The scale of this collection effort highlights HMRC's increasingly aggressive approach to recovering perceived tax shortfalls, raising concerns about the fairness of targeting vulnerable households for historical payments they may not have known they owed.
