HM Revenue and Customs

5. Mr E complains HMRC failed to take his disability, reasonable adjustments, and individual circumstances into account and unnecessarily delayed its consideration of his applications for SEISS 4 and 5.

6. Specifically, he says he was told HMRC’s review team would consider his case within three weeks, however, a decision was quickly made over that weekend to reject his case, and he was not given an opportunity to provide any substantive information to support his case. Further, he says his case was not referred to HMRC’s discretionary board and it was not explained to him that this was even a possibility in the process. Finally, he says HMRC offered him a financial remedy that was too low and did not reflect the impact the experience had on him.

7. As a result, although Mr E was eventually given access to SEISS 4 and 5, he says he was left without finance for over a year, when he vitally needed it, which would have helped him cover the costs associated with running his business. He says he had to use his Universal Credit (UC) payments to support his business instead of using them to support himself through the pandemic. He says this eventually led to him losing his business and he is no longer self-employed. He says this created a financial uncertainty which was made worse when HMRC also started to pursue him for an unrelated tax debt. Finally, he says his mental health and emotional well-being have been damaged by HMRC’s actions.

8. By bringing this complaint to us, Mr E would like systemic improvements to the way HMRC handles requests from people with disabilities and accessibility needs. He would also like a £5,000 financial remedy in recognition of the impact on his business and him emotionally.

9. On 28 May 2021, Mr E’s accountant submitted his 2019-20 SATR, which was the SATR HMRC had to use to calculate his entitlement to SEISS 4 and 5. He contacted HMRC on the same day and asked to make a claim for SEISS but was told because his SATR was late, he was not eligible. HMRC agreed to raise a request for a review of Mr E’s case because he had mitigating circumstances. HMRC did not respond to his review request for SEISS 4.

10. In August 2021, Mr E contacted HMRC to chase an update on its review of his case with regard to his eligibility for SEISS 4. He also said he wanted to apply for SEISS 5. Again, HMRC told him he was not eligible, and it requested a review of Mr E’s case.

11. In October 2021, Mr E complained to HMRC that he had not received a response to his review requests. Later that month, HMRC’s complaints team wrote to Mr E and said he was not eligible for SEISS 4 and 5.

12. Mr E continued to complain in the months that followed, but HMRC’s complaints team continued to tell him he was not eligible. He approached the Adjudicator’s Office (the Adjudicator) in June 2022 and it asked HMRC to investigate Mr E’s concerns. In July 2022, HMRC awarded Mr E funds under SEISS 4 and 5 and paid him £5,600.

Reasonable adjustments

15. Mr E complains HMRC failed to take his disability, reasonable adjustments, and individual circumstances into account and unnecessarily delayed its consideration of his applications for SEISS 4 and 5. He says HMRC told him its review team would consider his case within three weeks. However, a decision was quickly made over that weekend to reject his case.

16. Mr E told us he was not given an opportunity to provide any substantive information to support his case. This was despite being told he would receive a call back from the team reviewing matters because he was unable to submit anything in writing because of his disabilities. Mr E said HMRC has provided him with audio documentation instead of written letters for years, so it was fully aware of his disabilities.

17. The Treasury’s SEISS 4 and SEISS 5 Directions set out the eligibility criteria a person must meet to qualify for each scheme respectively. Both SEISS 4 and 5 required a person to have submitted their 2019-20 SATR by 2 March 2021, amongst other criteria. As per these directions, a person would not qualify for the scheme if their SATR had not been submitted by 2 March 2021. While there is nothing within the directions which allows HMRC to use discretion, HMRC created a policy that would give it some discretion in exceptional circumstances. We explain more on this later.

18. ‘The HMRC Charter’ says HMRC will provide services that are accessible, treat its customers fairly, and answer questions and resolve things first time. Our ‘Principles of Good Administration’ say organisations should treat people with sensitivity, bearing in mind their individual needs, and respond flexibly to the circumstances of the case. They also say organisations should do what they say they are going to do.

19. We consider HMRC did not obtain the relevant information to decide on Mr E’s request for a reasonable adjustment, failed to consider his individual circumstances and unnecessarily delayed its consideration of Mr E’s applications for SEISS 4 and SEISS 5. While HMRC took account of the Treasury Directions, it failed to consider its Charter, its discretionary policy for SEISS and our Principles.

20. We think the following points and evidence are relevant:

• On Friday 28 May 2021, Mr E asked HMRC to review his eligibility for SEISS 4 on the basis his disability prevented him from submitting his Self-Assessment Tax Return (SATR) before the SEISS deadline of 2 March 2021. Mr E said he could provide evidence of his disability if it was required, but he would need to provide the evidence verbally because of his disability.

• On 2 June 2021, HMRC told Mr E via audio document he was not eligible for SEISS 4 without contacting him in line with his request for a reasonable adjustment.

• On 9 June 2021, Mr E contacted HMRC and said he had been left disadvantaged by because HMRC did not contact him before making its decision as he had requested. The HMRC officer told him nothing further could be done, and he should raise a complaint.

• On 23 August 2021, Mr E contacted HMRC to make a claim for SEISS 5. He said he had tried to make a claim for SEISS 5 online, but his dyslexia prevented him from doing so. He also said HMRC decided he was ineligible for SEISS 4 due to the late submission of his SATR and he had been asking HMRC since May 2021 to asking HMRC to contact him so he could provide verbal evidence about his disability. The HMRC officer said there was nothing they could do so Mr E asked for a manager call back.

• On 24 August 2021, an HMRC manager called Mr E and discussed his SEISS eligibility. They sent a further referral to HMRC’s review team, but they did not contact him.

• On 18 October 2021, Mr E contacted HMRC about his eligibility for SEISS 4 and 5. He said he had not been contacted and he was being excluded from the process. He asked HMRC for contact details to send a complaint. A referral was also sent to HMRC’s review team for a call back but again, they did not contact to him.

21. For HMRC to have had due regard for Mr E’s reasonable adjustment request, we expect there to be evidence of its consideration of his request and its subsequent decision. HMRC has told us it accepts its review team should have contacted him by phone to allow him to provide evidence.

22. Instead, HMRC made its decision on 2 June 2021 and said he was ineligible because his 2019-20 SATR had not been submitted by 2 March 2021 which was the deadline for SEISS purposes. This meant HMRC’s decision was based solely on his late SATR (and the Treasury direction) and it had not taken account of his disability, or any other reasons he told it he wanted it to consider.

23. Despite Mr E making several attempts to engage with HMRC about SEISS 4 and 5 in the subsequent months, HMRC continually repeated its earlier decision regarding his eligibility, without taking account of his circumstances.

24. Despite HMRC’s front line staff sending referrals to its review team requesting a call back, no call back was made, and Mr E was unable to provide his evidence. When he proactively provided additional medical evidence (which he thought would support his case and was sent without any direction from HMRC) in January and February 2022, this was not handled correctly. This delayed HMRC’s review and consideration.

25. With all the above in mind, we consider HMRC did not act in line with ‘The HMRC Charter’, or our principles. HMRC based its decision to refuse eligibility on the information it had, which Mr E had already told them was incomplete, and this therefore meant the consideration of his applications for SEISS 4 and SEISS 5 were delayed.

26. We therefore consider this to be a failing.

Complaint handling and discretionary board

27. Mr E says HMRC mishandled his complaints about its decisions regarding his eligibility for SEISS 4 and 5.

28. He also says HMRC failed to tell him about the existence of its discretionary board and did not refer his case to them until over a year after he asked for a review. He says this means he was denied the opportunity to engage with the process fully.

29. To reach a decision, we referred to HMRC’s discretionary policy.

30. This policy said HMRC’s discretion would be used in very limited circumstances. It said HMRC may decide to exercise discretion and allow individuals to access SEISS grants if, among other things, the taxpayer had tried to be compliant, and they were unable to comply due to a particular vulnerability.

31. In addition, we referred to ‘The HMRC Charter’, our ‘Principles of Good Administration’ and our ‘UK Central Government Complaint Standards’.

32. ‘The HMRC Charter’ says HMRC will provide accurate, consistent, and clear information and help them understand their rights. It also says if a person disagrees with HMRC, it will tell them the options available to them and work with them to reach an appropriate outcome quickly and simply. It also says HMRC will answer questions and resolve things first time, or as quickly as it can.

33. Our ‘Principles of Good Administration’ and ‘UK Central Government Complaint Standards’ say organisations should aim to carry out one thorough investigation to deal with the concerns raised by a person, rather than multiple investigations one after the other. This is because multiple consecutive investigations sometimes result in open-ended investigations that take up too much time, resource, and can be confusing.

34. They also say organisations should be clear in their responses and transparent about their decision making, providing sufficient information to people. They say we expect organisations to explain when something has gone wrong and identify a suitable way to put things right for people. This can include reviewing or remaking a decision and reviewing the service provided to identify what more should have been done.

35. First, we have considered how HMRC handled Mr E’s complaints. We consider HMRC handled Mr E’s complaints and requests fell far below its own standards and our Principles. We also consider HMRC failed to refer Mr E’s case to its discretionary board at the earliest opportunity.

36. We think the following points and evidence are relevant:

• Mr E told HMRC he disagreed with its decision regarding his eligibility for SEISS 4 on 28 May 2021. He told it he wanted the decision to be reviewed, but he would need to provide verbal evidence over the phone because of his disability. Despite this, on 2 June 2021 HMRC issued another decision regarding his eligibility and told him he was ineligible without speaking to him.

• On 9 June 2021, Mr E contacted HMRC and told it he had been left disadvantaged because HMRC did not contact him before reviewing its decision. He was told nothing could be done and he should raise a complaint.

• Between August 2021 and November 2021, Mr E spoke to HMRC on five occasions. He said he was unhappy with HMRC’s decision that he was not eligible for SEISS 4 and 5. He said HMRC had not taken account of his personal circumstances before making its decisions.

• During this period, HMRC made referrals to its review team and promised him call backs to discuss his situation. However, HMRC did not contact him and it sent him audio documents repeating its earlier decisions. It did not show that it had considered his circumstances, and it incorrectly said he had submitted his 2019-20 SATR on 28 July 2021.

• Between December 2021 and March 2022, Mr E continued to contact HMRC to tell it the review team had not contacted him by phone as promised. He also proactively submitted a bundle of medical evidence in January and February 2022 to try and support his case and prompt a response from HMRC. However, HMRC filed this medical evidence away, and in its letter dated 29 March 2022 it repeated the same decision it had made previously. It was silent on its consideration of Mr E’s personal circumstances.

• On 18 May 2022, Mr E asked HMRC to escalate his complaint to tier 2 of its complaints process, but it did not respond and took no action.

37. We consider the above demonstrates HMRC was not acting in line with ‘The HMRC Charter’ or our ‘Principles of Good Administration’ and ‘UK Central Government Complaint Standards’.

38. Mr E clearly disagreed with HMRC’s decision regarding his eligibility in May 2021. He asked HMRC to make provisions to allow him to put his best case forward for a review of the decision, but HMRC did not do this. Mr E repeatedly made attempts to engage with HMRC in the subsequent months.

39. HMRC should have carefully considered the points he raised, properly investigated and responded to his concerns with a clear rationale. However, it did not do this. Instead, it kept promising him call-backs and responses and repeating the same decision it had previously made with no further explanation.

40. We consider this to be a failing. We will revisit the impact of this later.

41. In June 2022, Mr E contacted the Adjudicator because HMRC ignored his request to escalate his complaint to the second tier of its complaints process.

42. The Adjudicator contacted HMRC and asked it to investigate his concerns under the second tier of the complaints process and provide Mr E with a final response. When HMRC carried out this investigation, it decided Mr E’s case warranted a referral to its discretionary board. It decided the referral to the discretionary board was necessary because:

‘there was enough evidence between what Mr E had sent to HMRC, and previous notes on the record for the case to be considered for Exceptional Circumstances (even if the board returned a “refusal”)’

43. The discretionary board reviewed Mr E’s case in July 2022 and it decided to allow Mr E’s claim.

44. HMRC spoke with Mr E on 8 and 11 July 2022 and, on 14 July 2022, it contacted him to confirm it would pay him a total of £5,600 in SEISS (£2,800 for SEISS 4 and £2,800 for SEISS 5). It also offered a further financial remedy of £150 in recognition of the worry and distress its failings had caused.

45. In our view, we consider HMRC should have sent Mr E’s case to its discretionary board for review much sooner. We recognise Mr E sent HMRC some medical evidence and several complaints between January 2022 and March 2022, but HMRC had several opportunities before this to make the referral. Further, this information he provided did not tell HMRC anything it did not already know, or could not have obtained from him had it engaged sooner.

46. Mr E had been vocal about his disagreement with HMRC’s decision and made clear his views about what HMRC should do to allow him access to the process, as early as May 2021. We have already set out the number of times Mr E contacted HMRC to try to progress matters - he requested call-backs, and several referrals were made to HMRC’s review team but it did not engage with him.

47. HMRC’s discretionary policy for SEISS allows it to exercise discretion when certain criteria are met. This includes exceptional circumstances where the taxpayer has attempted to be compliant, a vulnerability stopped them from submitting their SATR, and the consequences of not paying the grant would be unconscionably harsh.

48. HMRC has told us it does not consider Mr E met any of the conditions set out in its discretionary policy, and that the HMRC officer he spoke to on 28 May 2021 took a pragmatic approach when they suggested a referral could be made.

49. It said it did not tell Mr E the discretionary board existed and what circumstances needed to be present his case for a referral to be made, due to the risks of fraudulent claims.

50. HMRC has also told us it did not publicise the existence of the discretionary board because it was created for exceptional circumstances. It told us publicising the existence of its discretionary board, and the criteria used when deciding whether to exercise discretion, increased the risk of people abusing SEISS and HMRC’s policy to make fraudulent claims for SEISS.

51. We do not criticise HMRC for its concerns about increasing the risk of fraudulent claims. We recognise publicising the discretionary board’s existence and the criteria that needed to be met could increase fraudulent claims. It is a matter for HMRC to determine whether it should publish information in the public domain.

52. That said, HMRC had a responsibility in line with ‘The HMRC Charter’ and our ‘Principles of Good Administration’ and ‘UK Central Government Complaint Standards’ to be clear there was a mechanism in place where Mr E’s circumstances could be considered and balance the available evidence accordingly before reaching a decision.

53. HMRC was aware in May 2021 that Mr E had made attempts to be compliant (by requesting an extended deadline for submitting his 2019-20 SATR) and that he felt his vulnerability, which is his disability, prevented him from submitting his 2019-20 SATR on time. HMRC also had a pre-existing record of Mr E’s disabilities because its extra support team sent him audio documents, instead of letters, for years.

54. HMRC did not have any new evidence available in June 2022 when it referred Mr E’s case to its discretionary board that it did not have, or could have reasonably obtained, in May 2021 had it kept its promises.

55. HMRC sent responses to Mr E that did not show it had acknowledged or considered his circumstances. HMRC simply kept repeating the same decision without providing any reasons for it.

56. This means we consider HMRC did not make it clear to Mr E his exceptional circumstances could be considered, and it did not follow through with a consideration of his circumstances until June 2022 after the Adjudicator had asked it to carry out further work.

57. This was not in line with ‘The HMRC Charter’ or our ‘Principles of Good Administration’ and ‘UK Central Government Complaint Standards’ and we consider this to be a failing.

HMRC’s financial remedy offer

58. While HMRC has paid Mr E the SEISS 4 and SEISS 5 grants, Mr E says the £150 financial remedy HMRC offered him for the impact of its mistakes was too low. He said it did not reflect the impact the experience had on him.

59. HMRC offered Mr E £150 in financial remedy in July 2022 following its tier 2 investigation and referral to the discretionary board because it found failings in the way it handled his requests.

60. HMRC had originally offered him £100 but, after Mr E told it £100 was not enough to recognise the impact of its failings on him and he felt it had overlooked his disability, HMRC increased this to £150. Mr E has told us he did not accept the £150 because it was still far too low. He also says he had no confidence HMRC had learnt from its mistakes and would not treat others who have disabilities in the same way in the future.

61. As such, Mr E complains HMRC failed to provide a sufficient remedy that addressed the impact arising from its failings beyond its payment of SEISS.

62. When HMRC decides on financial remedy, it uses its ‘Complaints and Remedy Guidance’.

63. This guidance says payments HMRC makes are ex gratia and come from public funds and it will make payments for financial loss where its mistakes or delays were the direct and sole cause of that financial loss, and this is supported by irrefutable evidence. It also says HMRC will consider making payments to its customers if its mistakes led to worry, distress, confusion or sadness, or made an already difficult situation worse. These payments are designed to be a token and tangible recognition of its mistakes, rather than punitive.

64. Payments HMRC makes for worry and distress will typically range between £25 and £500. That said, it may pay towards the higher end, or exceed this range, if its mistakes have had a significant impact. In other words, HMRC’s ‘Complaints and Remedy Guidance’ allows it to decide what financial remedy it thinks is appropriate based on the individual merits of the case.

65. We asked HMRC to provide evidence of the consideration it gave to Mr E’s case when it decided to award him £150 in financial remedy, including what information it used to reach this decision. However, HMRC has not provided us with any documentary evidence that shows how it reached its decision to offer Mr E £150 in financial remedy.

66. As such, we are unable to say what it considered before reaching this decision. Our ‘Principles of Good Administration’ say organisations should create and maintain reliable records and evidence of their activities and should state their criteria for decision making and give reasons for their decisions.

67. As there is no evidence to show how HMRC reached its decision to award Mr E £150 in financial remedy, we consider this to be a failing.

Impact

68. We have found the following failings:

• HMRC failed to have due regard for Mr E’s request for reasonable adjustments when it considered his requests for a review of his SEISS 4 and 5 eligibility.

• HMRC poorly handled his complaints and failed to fully consider his circumstances before reaching its decisions about his SEISS 4 and 5 eligibility.

• HMRC failed be transparent about its process and failed to refer Mr E’s case to its discretionary board at the earliest opportunity.

• HMRC did not document what evidence or information it considered when it decided to award Mr E £150 in financial remedy.

69. If not for the failings we have identified, we consider on the balance of probability:

• In accordance with its Charter, HMRC’s review team would likely have spoken with Mr E on the phone in June 2021, in line with his request, to explore his mitigating circumstances and the reasons why his SATR was late and, if necessary, help him to provide information to support his claim.

• HMRC would likely have referred Mr E’s case to the discretionary board in June 2021 for consideration which we would have likely resulted in his late SEISS 4 claim to have been allowed and the SEISS 4 grant paid to him. We think this because HMRC’s discretionary board reviewed Mr E’s case in July 2022 and confirmed his eligibility on the same facts.

• Mr E’s claim for SEISS 5 when applications opened in July 2021 would have been accepted and the grant subsequently paid to him.

• HMRC would have asked Mr E how its mistakes had impacted him and documented its consideration of this, and how this informed its decision to award him £150 in financial remedy.

70. Mr E has told us he suffered a financial loss, and emotional impacts because of HMRC’s failings. We have set our thinking out below.

Financial loss

71. Mr E says he struggled to make ends meet without the funds from SEISS 4 and 5. He told us he receives around £1,000 a month from UC and £600 of this covers his rent. He says he usually uses the remaining £400, and any income generated by his business to cover his business costs and live. However, without the SEISS funds, the £400 left over from UC was all he had. He has told us once the COVID-19 restrictions were lifted, he was able to resume trading with his business, and it was not lost.

72. The COVID-19 pandemic meant he could not run his business due to restrictions on his industry. Therefore, he says his options were to either not work and rely on his UC and SEISS funds to cover ongoing business costs (which total around £5,350 per year) and fund his life or seek PAYE employment. Initially, Mr E used the £400 and struggled to make ends meet. Mr E told us he had to rely on his business overdraft to ‘get by’ and was living ‘close to the knuckle’.

73. We have seen no evidence Mr E incurred penalties or charges because of using his business overdraft, or any other charges associated with credit cards or loans. We have considered the impact of Mr E drawing on his overdraft. Once Mr E received the SEISS funds, the evidence we have seen shows his finances were restored to what they should have been. In particular, it was open to him to restore his overdraft to its original state before the failings occurred.

Emotional impacts

74. Mr E says he was very stressed, was worried about paying his bills, and lost faith in HMRC. He told us he was repeatedly contacting HMRC to try and fix the problem, but it would not listen, and continuously failed to help him. He says this happened from May 2021 until July 2022 when, after the Adjudicator became involved, HMRC started to listen.

75. Because HMRC told him he was not eligible for SEISS 4 and 5, he says he had no option but to seek PAYE employment in October 2021, when things became too difficult financially. He says he was forced to take this action to cover his costs and it was stressful for him. He says this would not have been his preference, because his disabilities make it harder for him to apply for roles and perform well in assessments and interviews. His preference was to rely on UC and SEISS to ‘get by’ until the COVID-19 restrictions were lifted.

76. Mr E says he successfully took up PAYE employment in October 2021 in a role he was overqualified for. However, this job was easier for him to secure because the application and interview process was easier. He says his disabilities prevent him from applying for the higher earning jobs that his skillset and experience is more geared towards. He says sadly, this was the situation he found himself in because of the difficult position HMRC left him in and he had no other option.

77. He says while the securement of employment alleviated some of the financial pressures outlined above, and the emotional distress he was experiencing, he was given tasks that were difficult or impossible for him to complete because of his disabilities.

78. This caused him further upset and distress and, eventually, culminated in an incident during a live show in front of 600 people in which he could not operate the lights. This led to him being humiliated, and he left the role in April 2022.

79. HMRC offered to pay Mr E £150 in financial remedy in recognition of the impact its mistakes had on him.

80. Our ‘UK Central Government Complaint Standards’ say we expect organisations to provide a meaningful apology and, where possible, provide a remedy that aims to return anyone affected to a position they would have been if the failings had not occurred. If this is not possible, we expect any remedy to compensate them appropriately.

81. While we recognise HMRC’s discretionary board allowed Mr E to make late claims for SEISS 4 and 5, this on its own would not have been enough to put things right for him. This is because of the emotional impact HMRC’s actions also had on Mr E. We recognise HMRC came to this conclusion as well, which is why it offered to pay him £150 in financial remedy. However, we do not consider this is enough based on the impact Mr E describes.

82. Our ‘Severity of Injustice Scale’ sets out the amounts of financial remedy we consider appropriate depending on the impact arising from an organisation’s mistakes or failings. We refer to this when we consider whether the amount offered by an organisation is fair and appropriate.

83. In this case, HMRC’s £150 financial remedy falls within ‘Level 2’ of our scale, which carries a range of £120 to £550. We expect financial remedies within this range to be paid where the impact is distress, worry, annoyance, or similar, and of the sort which a healthy adult would be expected to deal with on a regular basis. We would not expect the emotional impact to affect the person’s day to day functioning or ability to live a normal life for a period from one to two weeks up to around six months.

84. We also consider a financial remedy in this range to be reasonable where delays in complaint handling lasted from a few weeks up to around a year, or longer if we find there was no substance to the complaint.

85. The impact Mr E describes is more significant than what we would typically expect to be appropriate for ‘Level 2’ on our scale.

86. As such, we consider this to be too low.

87. Based on the evidence available to us, we can see that Mr E’s mental health and well-being was impacted by HMRC’s failings. This is supported by the numerous calls Mr E made to HMRC where he was seeking assistance to help his situation. Having listened to these calls, we recognise how distressed and frustrated Mr E was. Mr E was clearly distressed and experiencing financial uncertainty. He grew more frustrated as time passed and HMRC was not considering his mitigating circumstances.

88. This continued for 14 months, from May 2021 until July 2022.

89. We consider the pressure and upset caused by HMRC’s failings would have been particularly acute and caused Mr E unnecessary pressure and suffering in the first five months of that period. From October 2021 when Mr E secured additional employment, we consider the financial pressures and distress were alleviated.

90. That said, we think there was likely some residual worry and distress that was ongoing until July 2022 when he finally received the funds from SEISS 4 and 5. This is clear based on his continued attempts to find a solution with HMRC during this period.

91. With regards to Mr E’s view he was forced to seek employment because he did not receive SEISS 4 and 5 in 2021, we do not consider it is possible to say this was caused solely by the failings we have found. By extension, we cannot say the humiliating experience he had during this employment was because of the failings identified.

92. The total amount of funds he would have received from SEISS 4 and 5 in 2021 is £5,600, and we are mindful this is a significant amount that would have helped Mr E pay his business costs. We also recognise he would not have needed to rely on his UC to support his business if this had been paid.

93. That said, Mr E has told us he subsequently earned around £22,500 in six months between October 2021 and April 2022 from the PAYE employment he secured.

94. This means there is a large disparity between what Mr E should have received under SEISS 4 and 5, and therefore what he claims he could have survived on, and the amount of money he earned when he took up employment.

95. As such, it is not possible to say whether the failings identified led to Mr E needing to seek PAYE employment, and that he would not have sought employment anyway, bearing in mind the restrictions in place continued to prevent him from trading. The COVID-19 restrictions that were preventing Mr E from trading were outside of HMRC’s control.

96. However, we do recognise the failings meant Mr E lost an opportunity to decide what the best option for him and his finances was. If Mr E had received the SEISS 4 and 5 funds, he could have chosen whether to try and survive on this and his UC or, if necessary, seek alternative employment to increase his income. This means he was denied the opportunity to keep supporting himself and his business without the need to take additional action/employment.

97. We also think the issues in this case go wider than Mr E’s case. We are concerned that despite Mr E’s repeated attempts to resolve his situation, it took 14 months and the Adjudicator’s intervention for HMRC to recognise its mistakes and act on them. HMRC had processes in place, and the information available to it at the start of Mr E’s case, to address his concerns and resolve his situation.

98. We are concerned there are others who may have found themselves in a similar situation, where HMRC simply did not recognise its mistakes and act to put things right. We therefore consider there is an unremedied injustice that goes wider than this case.

1. We have found failings by HM Revenue and Customs (HMRC) in relation to its handling of Mr E’s requests for reasonable adjustments, and reviews about his eligibility for the fourth and fifth Self-Employment Income Support Scheme grants (SEISS 4 and 5). We also found failings in HMRC’s complaint handling responses, and that it did not refer Mr E’s case to its discretionary board at the earliest opportunity. We also consider HMRC failed to document how it reached its decision to award Mr E £150 in financial remedy.

2. We consider this caused Mr E significant distress and pressure over many months at a time when he was suffering financial worries during the COVID-19 pandemic.

3. We therefore partly uphold this complaint.

4. We recommend HMRC acknowledge the failings we have found and apologise to Mr E and pay him £1,500 in recognition of the impact its failings had on him. We also recommend HMRC review learning from this case, which it can then use to inform its handling of future crises that may arise, not just pandemics, and its service more generally, and share its findings and any evidence of the changes it has made, or plans to make, with us.

99. We have already set out our view on HMRC’s failings and their impact on Mr E. We have decided to make recommendations to put things right.

100. In considering our recommendations, we have referred to our ‘Principles of Good Administration’, ‘UK Central Government Complaint Standards’, and ‘Severity of Injustice Scale’.

101. These say where poor service or maladministration has led to injustice or hardship, the organisation responsible should take steps to put things right. We have also referred to our ‘Severity of Injustice Scale’ which we use to help us determine how much financial remedy an organisation should pay complainants dependant on the impact its failings have had on them.

102. They say organisations should put things right and, if possible, return the affected person to the position they would have been in if the poor service had not occurred. If that is not possible, they should compensate them appropriately.

103. We consider the emotional impacts outlined above fall in level four of our ‘Severity of Injustice Scale’. This is because we consider the impact on Mr E to have been emotional distress, and the sense of a lost opportunity, that lasted for 14 months (May 2021 to July 2022).

104. We consider this would have been acute for Mr E for the first five months and caused him great unnecessary distress and pressure. We consider this went beyond ordinary distress and inconvenience and would have taken over his life at that time.

105. In line with the ‘UK Central Government Complaint Standards’ and our ‘Severity of Injustice Scale’ we recommend that within a month of the date of our final report HMRC should:

• write to Mr E to acknowledge the failings identified in the report and apologise for the emotional impact of those failings • pay Mr E £1,500 in recognition of the emotional impact of those failings.

106. Our ‘Principles of Good Administration’ and ‘UK Central Government Complaint Standards’ also say organisations should seek continuous improvement and where necessary, ensure changes are made to policies, procedures, systems, staff training or all of these, to ensure maladministration or poor service is not repeated. We recognise SEISS ended in September 2021, so we will not make any recommendations about SEISS specifically.

107. However, we think HMRC should apply learning from this case for future crises of any kind that may arise, not just pandemics, and think about how this could affect its customer service and communication. We also think it should consider whether any learning from this case could help improve the service it gives to customers more generally.

108. As such, we recommend that within three months of our final report HMRC should:

• review learning from this case, which it can then use to inform its handling of future crises that may arise, not just pandemics, and its service more generally, and share its findings and any evidence of the changes it has made, or plans to make, with us.

109. We recognise how distressing this experience was for Mr E and we hope our report resolves matters for him and helps draw a line under a difficult time in his life. We also hope it reassures him HMRC will take learning from his experience and make the necessary improvements.