How long should it take HMRC to deal with a repayment request?

HMRC launched a new service on 29 September 2021 to enable taxpayers to check online when they can expect a response to a query they have raised. The waiting times identified by this service  are disturbingly long, as is the fact HMRC apparently now considers these delays so normal they have a special service to calculate them.

The first thing to note is that it only applies to individuals, and there is no equivalent for corporation tax or trust queries. There is no indication whether the facility will be extended to these work streams in future.

So how long will it take to deal with your correspondence? As with all things tax, it depends on several factors, including whether it is a repayment claim or general correspondence, how it was submitted  and whether it relates to income tax, self-assessment or tax credits. 

We found some shocking results:

The expected response time depends upon the method used to contact HMRC. This can be seen if you input details for an income tax repayment where an online application has been made compared to a paper return or a letter requesting a repayment.

The online application currently shows a response time of 203 days or 29 weeks as does the letter requesting repayment while the paper return shows a 147 day or 21 week response time.

The disparity with HMRC’s expectations of taxpayers:

This raises  the question of how this timescale fits with HMRC’s expectations of taxpayers; eg  HMRC’s response deadline dates for enquiries into these same returns.  These require a response within 30 days, irrespective of the method of submission. If this is not adhered to, a formal request for the information is made with a further 30 days to respond or the taxpayer is automatically into a penalty position for failure to meet deadlines.

It appears to be a case of one rule for the taxpayer and another for HMRC.

It is shocking that such huge response times are being normalised. It has been clear for some time that HMRC is under-resourced, but a wait of over six months for a repayment to be dealt with is unacceptable by any standards.