HMRC has issued an updated version of their online guidance on Genuine HMRC contact and recognising phishing emails and texts. The guidance provides a current list of genuine messages from HMRC. This includes email messages, text messages and telephone contacts from HMRC.

The latest updates on the list includes confirmation that HMRC is contacting some taxpayers by email who opened a Tax-Free Childcare account but no longer use it. The research will help HMRC to understand how best to support working families with their childcare costs.

HMRC is also working with independent research company IFF Research to help understand barriers to signing up for and using Tax-Free Childcare. You may get a letter from IFF Research telling you about the research and an invitation by telephone to take part. Participation is voluntary.

Although all these communications are genuine, taxpayers should still be wary of receiving messages that are purported to come from HMRC. Fake email and text messages can appear to be genuine but clicking on a link from these messages can result in personal information being compromised and the possibility of computer viruses affecting your computer or smartphone.

If you are unsure as to the validity of any message it should not be opened until the sender can be verified. The validity of letters from HMRC can also be checked by contacting HMRC directly by telephone to confirm if a letter is genuine.

The government has announced new plans to crackdown on high pressure and bullying tactics to sell pre paid funeral plans. These tactics are often used to target those who are old and vulnerable and unaware exactly what they are buying. In some cases, the funeral plans are sold with misleading promises and to maximise the salesperson's commission.

Demand for funeral plans has grown significantly over recent years and last year over 177,000 plans were sold and cost on average between £2,500 and £5,000. A regulator does currently exist to oversee these plans, which operate on a purely voluntary basis and firms are not required to sign up to the rules. Under new proposals published earlier this month the regulation of the sector would be moved to the Financial Conduct Authority (FCA).

The FCA will seek to ensure that funeral plan providers are clear and fair in their treatment of customers and will also offer access to the Financial Ombudsman Service, enhancing consumer protection. Under the new plans, anyone found breaching the regulations can have their authorisation revoked, face fines and even criminal charges. The consultation on the proposed changes is open for comment until 25 August 2019.

If you are owed money by an individual or business, there is a procedure you can use called making a court claim. This was more commonly referred to as taking someone to a 'small claims court'.

Before making a claim, you should try to contact the person or organisation to try and resolve the issue by discussion or by using a specialist mediation service.

If this is unsuccessful and you are making a court claim for a fixed amount, this can be done online or by paper. An online claim can be made at www.gov.uk/make-money-claim. If you are making a claim for an unspecified amount you must download and complete the N1 claim form.

Paper forms need to be sent to the following address:

County Court Money Claims Centre
PO Box 527
Salford
M5 0BY

There are court fees to pay when making a claim. The amount of the fee depends on the size of the claim and whether the claim is made online or by paper. The fees can range from £25 to £10,000.

You may be required to go to court if the person or business you are claiming from denies owing you the money. If you are successful in obtaining judgement, but do not get paid, there are further steps that can be taken including the use of bailiffs to try and get what you are owed.

There are a number of options open to taxpayers who disagree with a tax decision issued by HMRC. As a first step, it may be possible to make an appeal against a tax decision. There is normally a 30-day deadline for making a claim, so time is of the essence. HMRC will then carry out a review, usually by using HMRC officers that were not involved in the original decision. A response to an appeal is usually made within 45 days but can take longer for complex issues.

In certain cases, it is possible to appeal against penalties on the grounds of having what is known as a 'reasonable excuse'.

HMRC’s guidance lists the following examples of what may count as a reasonable excuse:

• your partner or another close relative died shortly before the tax return or payment deadline
• you had an unexpected stay in hospital that prevented you from dealing with your tax affairs
• you had a serious or life-threatening illness
• your computer or software failed just before or while you were preparing your online return
• service issues with HMRC online services
• a fire, flood or theft prevented you from completing your tax return
• postal delays that you couldn’t have predicted
• delays related to a disability you have

However, not receiving a reminder, relying on someone else or making a mistake are amongst the reasons not counted as reasonable excuses.

The current Governor of the Bank of England, Mark Carney, will step down from his role on 31 January 2020. Mr Carney had been due to step down earlier but agreed to stay in his role to help support a smooth exit from the European Union. Although this has not yet happened, the Chancellor has confirmed that Mr Carney will step down in January 2020 as planned, and the search for a new Governor of the Bank of England has been launched.

The Chancellor of the Exchequer, Philip Hammond, said:

'In today’s rapidly evolving economy the role of Governor is more important than ever. Finding a candidate with the right skills and experience to lead the Bank of England is vital for ensuring the continuing strength of our economy and for maintaining the UK’s position as a leading global financial centre.'

The appointment of Mr Carney was the first time the position of Governor was held by a foreigner since the Bank of England was founded in 1694. The recruitment net for the next Governor has been designed to ensure that the most qualified candidate is appointed from the broadest possible pool of applicants.

The new role has been advertised on the Cabinet Office public appointments website and potential candidates have been informed that they should be able to commit to an eight-year term.

Last week we posted that it is over 10 years since Debt Relief Orders (DROs) were first introduced in April 2009. This week we have fleshed out the details of who can claim and some of the restrictions that apply.

What is a DRO?

A DRO is a special way of dealing with debts available to those with minimal assets and low income. If an application for a DRO is accepted, you will make payments over a specified period (usually 12 months) after which any remaining debts will be written off.

There are special rules that exclude any debts that were fraudulently obtained, continue to be repayable, and if your circumstances change (for the better) the DRO can be revoked.

To be eligible for a DRO, you must meet these criteria:

• you owe £20,000 or less
• you have less than £50 to spend each month, after paying tax, National Insurance and normal household expenses
• you've lived or worked in England or Wales in the last 3 years
• your assets aren’t worth more than £1000 in total
• you've not had a DRO in the last 6 years

When you can't apply for a DRO

Eligibility may also be affected if you are involved in bankruptcy proceedings or any other formal insolvency procedure. An application for a DRO must be made using an authorised debt adviser. There are also minimal costs you would have to meet when making an application.

There are certain debts that are not covered by a DRO and there are also restrictions on what you can do during the specified DRO period: for example, restrictions on obtaining credit of more than £500 without informing the lender about your DRO. A DRO will usually stay on your credit reference file for 6 years from the date it was granted.

Debt Relief Orders (DROs) were first introduced in April 2019. The DROs assist people who have small levels of assets and insufficient surplus income to deal with debts under £20,000. In a news release published by the Insolvency Service we are told that in the last 10 years, more than 254,000 DROs have been approved for people with debts averaging £9,400.

A DRO normally runs for 12 months after which the debts are written off. There are also restrictions during the DRO period, for example restrictions on getting credit of more than £500 without informing the lender of any outstanding DRO.

Paula Hogarth, DRO Service Debt Advice Centre Manager for StepChange Debt Charity, said:

'DROs are a good solution for people with minimal assets and low income who can’t afford to repay their debts. While it’s important that people get proper debt advice, as different circumstances lend themselves to different debt solutions, those people who are eligible for DROs definitely benefit from the relative speed, simplicity and low cost of setting up the solution, as well as usually becoming debt-free a year later.'

Those affected can apply for a DRO through an authorised debt adviser, from organisations such as Citizens Advice, StepChange and PayPlan, who submit applications on-line to the Official Receiver on their client’s behalf.

HMRC has launched an unannounced crackdown on money laundering regulation non-compliance by estate agents. This clampdown resulted in over 50 visits by HMRC staff to estate agents across England that were suspected of trading without being registered as required under money laundering regulations.

This crackdown includes targeting those who are trading without registering appropriately as well as those who may not be meeting their obligations in line with the money laundering regulations. One of the estate agents visited was fined £215,000.

Commenting on the campaign, John Glen, Economic Secretary to the Treasury, said:

'The vast majority of estate agents play by the rules and help us to crack down on dirty money. But I have zero tolerance for firms prepared to turn a blind eye to the law. Money laundering regulation exists to help protect honest business, so anyone who flaunts the law should know that swift action will be taken.'

HMRC is responsible for supervising a number of business types including Estate Agency Businesses to ensure that they register for anti-money laundering supervision. HMRC supervises more than 11,000 residential and commercial estate agents across the UK. This announcement by HMRC suggests that any estate agency businesses that have fallen through the cracks should ensure that they are properly registered and compliant as a matter urgency.

Under the current scheme, banks and building societies transfer the money held in dormant accounts to a central reclaim fund. The reclaim fund is responsible for managing dormant account money, meeting reclaims and passing on surplus money to various charities for reinvestment in the community. The original account holder retains the rights to repayment upon providing satisfactory proof that the money is theirs. 

The existing dormant accounts scheme came into effect in November 2008. The scheme defines a dormant bank account as an account which has been continually open for at least fifteen years during which time no transactions have been carried out by the account holder or at his or her instruction.

In June 2019, the government has announced plans to expand the dormant asset schemes to include a wider set of financial assets beyond bank and building society accounts. The government appointed four ‘industry champions’ to expand the dormant assets scheme. These experts represented the banking, securities, insurance and pensions, and investment and wealth management sectors.

The industry-led report was published earlier this month and has made a number of recommendations on how to broaden the current scheme. Government ministers will now consider the recommendations in more detail.

There is a free tracing service called ‘mylostaccount’ to find lost bank accounts. The service brings together the three tracing schemes of the British Bankers’ Association (BBA), the Building Societies Association (BSA) and National Savings and Investments (NS&I) into a single website (www.mylostaccount.org.uk) and is free of charge.

The service offers a way for savers to search for their lost accounts by enabling them to complete one form to search the majority of banks and building societies and National Savings & Investments (NS&I). An account may be defined as ‘lost’ if you have not made any withdrawals or deposits for a set period (typically three years in the case of a savings account and one year for a current account) and the bank has not heard that you wish to keep the account open. The monies remain the account holders property but may need to be searched for as a lost account.

The government’s dormant assets scheme allows money in accounts that have been dormant for at least fifteen years to be made available for certain qualifying charitable and community causes. The original account holder retains the rights to repayment of any monies within the scheme after providing satisfactory proof that the money is theirs.