3. Mr N complains that HMRC has not correctly applied part 1300 of its Admin Law Manual (ADML1300) to his case. He also considers HMRC’s consideration of this issue is not in line with our Principles for Remedy and the HMRC Charter.
4. Mr N says that this has caused him financial hardship. He would like HMRC to resolve the complaint by setting aside the underpayment it has claimed back from him.
5. In January 2022 HMRC told Mr N he was due a tax rebate of £6,328.80. This came about after he told HMRC in December 2021 that his pension was now his only income.
6. As the rebate was more than he expected to receive, Mr N says he contacted HMRC to check this was correct. He says it confirmed, twice, that this was the case.
7. In July 2022, HMRC wrote to Mr N to tell him that he had underpaid tax by £4,611.87 and he needed to pay this. The underpayment occurred because HMRC had refunded too much in January.
8. As Mr N felt this was unfair, given he checked the sum was correct at the time, he complained to HMRC in July. It responded in January 2023 and said the underpayment needed to be paid. HMRC told Mr N it could not set this aside in accordance with the discretion it had to do so as set out within Extra Statutory Concession A19 (ESC A19).
9. We originally reached a decision about Mr N’s complaint in September 2024. This did not fully consider the matter in respect of ADML1300 but focused mainly on ESC A19. It seems this was because HMRC itself had not considered ADML1300 at that point.
10. Having raised this with it, HMRC agreed to consider Mr N’s case in conjunction with ADML1300. It did this on 11 December and told him it did not believe his case met the necessary criteria for ADML1300 to apply. Mr N had further contact with HMRC about this up to July 2025 at which point we accepted this separate case to consider this aspect of his complaint.
ADML1300
13. When we decide if we should conduct a detailed investigation of a complaint, we look at whether there are signs the organisation has got something wrong. We do this by comparing what should have happened with what did happen. We have done this and have not found any indications that something has gone wrong.
14. ADML1300 states that ‘HMRC is only bound by incorrect advice in circumstances where all of the following tests are met: • The customer made it plain he or she was seeking fully considered advice and indicated what it would be used for • The customer provided all information relevant to the query • The advice given by HMRC was clear, unambiguous and without qualification • The customer acted in reliance on the advice (i.e. he or she did or refrained from doing something as a direct consequence of the advice) • The customer would suffer detriment if the correct statutory position were applied; (e.g. he would be financially worse off than if the correct advice had been given in the first place) • To apply the correct statutory position would be so unfair as to constitute an abuse of power.’
15. Mr N believes the circumstances of his case meet all these tests. He says he contacted HMRC by phone on 28 January 2022 to query the rebate it told him about earlier that month as it was more than he expected. He says it told him twice that this was correct and that he was free to spend the rebate, which he did.
16. HMRC and the AO have said, in summary, that there is no record of this phone conversation and so there is no evidence that Mr N’s case meets the first three criteria. We questioned HMRC about this further to reach our own decision. If we cannot conclude that the first three criteria are met, whether the remaining criteria are met does not need to be considered.
17. We asked whether there was ever a recording of the call. That is, we wanted to establish whether the call had simply not been recorded, or whether it had been recorded and then deleted, perhaps in accordance with HMRC’s retention policy.
18. HMRC explained that its retention policy exceeds the length of time since the call took place. That means if there was a recording made at the time, it would still be available now, four years later. It seems reasonable to rule this out as a reason for the lack of recording.
19. It says the call may well have been recorded but, if Mr N had called from a withheld number, it would be unable to trace it. HMRC says Mr N sent it a screenshot of the call, showing he dialled its general taxes helpline number at 10:43 on 28 January 2022. It seems he did this via a mobile phone but, despite searching for a recording using these details and both Mr N’s mobile and landline numbers, HMRC could not locate one.
20. Alternatively, HMRC says there could have been a technical error which caused the call not to be recorded. With this in mind, we looked for further evidence to suggest this might have been the case.
21. Usually, where a call is made to HMRC about something specific, as opposed to a more general enquiry, it would need to access the caller’s account. This tends to be done after data protection questions have been successfully answered and allows the advisor access to the relevant information they need to respond to the caller’s query. Accessing an account generally leaves a digital footprint (a data trail) on it. This is regardless of whether a note is made by the advisor about that call.
22. In the case of the 28 January call, HMRC says there is no record of it receiving a call in relation to Mr N’s account on this date. It confirmed there are records of calls from him on 22 December 2021 and 22 July 2022, but nothing between these dates. As a result, there is no digital footprint or notes made at the time of the call as would usually be the case.
23. HMRC explained that the screenshot Mr N sent it showed that the call he made lasted eight and a half minutes. This shows a call was made but it provides little detail as to what happened. While we appreciate this will be frustrating for Mr N, we do not think this is enough to show that either a conversation did or did not take place. It is feasible that this was enough time to select the right option, be connected to an agent, outline the reason for the call and receive a response. It is also feasible that this was the length of time spent waiting to be connected to an agent before disconnecting the call.
24. We are not suggesting Mr N is being untruthful in his statement about this call. In the absence of clear confirmation of the conversation he reports to have had, we must consider whether the evidence and information available to us means it is more likely than not that this happened. Unfortunately, there is not enough to support this being the case.
25. We have not been able to conclude, even on the balance of probabilities, that Mr N was given the advice he claims. Because of this, we are not satisfied that the case meets the first three of ADML1300’s criteria. Therefore, there are no indications HMRC got anything wrong in reaching its decision. We realise this will be disappointing to Mr N but hope he can see that we have given careful consideration in reaching this decision.
HMRC response
26. Mr N is unhappy with the responses HMRC provided regarding its consideration of ADML1300. He has asked that we provide him with ‘any evidence that the HMRC letter was compliant with extant policy and requirements of [our] own Principles for Remedy and the HMRC Charter, both referenced within the CRG document. These regulations note a range of criteria which must be followed, specifically • ‘is [the] decision fair, reasonable and balanced • does it provide objective evidence to support its decisions • does it explain impartially how it reached those decisions • was the investigation carried out in a timely manner by professionals who knew what they were doing?’
27. ‘The CRG document’ refers to HMRC’s internal manual ‘Complaints and Remedy Guidance’.
28. Our Principles ‘guide how public bodies provide remedies for injustice or hardship resulting from their maladministration or poor service’. In short, where there has been maladministration or poor service, they help organisations determine what to do to put this right. They tend to relate to ex-gratia, or goodwill, offers which public bodies often refer to as a consolatory payment. This is as opposed to setting aside tax underpayments in accordance with the law, policy or guidance for that.
29. Mr N has received a consolatory payment from HMRC in respect of its handling of his complaint about this matter. Our Principles would apply to this. However, this is not what Mr N’s complaint relates to. His complaint is that he feels that an appropriate remedy would be for HMRC to set aside the underpayment in accordance with the discretion ADML1300 gives it the ability to. This is not a consolatory payment, it is restitution. That is, it is made to correct an error and to put a person back into the position they would have been in if the error had not happened. Our Principles therefore do not apply to HMRC’s consideration of whether ADML1300 applies and so we will not consider this further.
30. HMRC’s CRG provides guidance to staff when decided how it should remedy a complaint. CRG2025 explains that by ‘remedy’ it means the action it takes to put things right when it has made a mistake. In Mr N’s case, there is not sufficient evidence of HMRC having made a mistake as we have outlined previously. Unfortunately, this means that the CRG is not applicable in this case and so we will not consider this further.
31. What we would expect to see HMRC’s response to be in line with is the Standards. These require public bodies to explain where things went wrong (where applicable), apologise and take action to remedy any errors. The Standards also say responses should give a clear and balanced account and refer to relevant legislation and policy, for example. Information should also be provided about how to escalate the complaint if required.
32. Having considered HMRC’s June 2025 letter, we are satisfied that it is in line with the Standards. HMRC set out why it did not think Mr N’s case met the ADML1300 criteria, albeit with a different focus than our decision about this. The letter acknowledged HMRC’s actions and errors, apologised for these and explained it would be making an additional consolatory payment of £250 in recognition of this. It also told Mr N he was able to refer his concerns to the AO should he wish to do so.
33. As we have not identified any areas of concern in respect of this letter, we will not consider this aspect of Mr N’s complaint further. We acknowledge that Mr N is unhappy with content of the letter and hope he is able to see that we have given this appropriate consideration.
1. We have carefully considered Mr N’s complaint about HMRC. We are sorry to hear about the problems he has experienced. We have no doubt HMRC’s decision to ask for a large portion of his tax to be returned to it would be worrying and upsetting.
2. We found that HMRC appropriately applied its guidance when it said Mr N’s case did not meet the criteria to set aside the tax underpayment it had created. We did not see that it failed to consider applicable guidance in reaching its decision.