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Pensioners warned over HMRC error


Thousands of pensioners are due to receive an unexpected tax bill after HM Revenue and Customs (HMRC) made an error when calculating their tax code.


It is believed that around 146,000 older people who have a state pension and a private income will have to pay back at least £800 each.


The error has arisen because HMRC failed to take account of their state pension when working out tax in 2010/11. HMRC said it was the result of a ‘computer glitch’ and is now writing to those affected.


It added that it would not be fair to other taxpayers to write off the money owed. Taxpayers will instead be expected to pay back in instalments up to 2015.


With letters due to go out in the next few months, some experts are advising pensioners to be aware of a possible rise in fraudulent emails and phone calls from criminals attempting to exploit the situation.


Commenting, Andrew Harrop, of Age UK, said: ‘Coming at a time when many pensioners are feeling financially stretched, HMRC's error will be a source of serious concern for older people on modest incomes.


‘When the taxman makes mistakes, older taxpayers should not have to pay the price, and we would have liked to have seen the repayments written off. It is essential that those affected are informed as soon as possible, allowing them time to put money aside for the extra cost.’