HMRC staff pocket £12million in overpayments after 'shocking error' with taxpayer money

HMRC Building

Staff have already paid back £12.3million, leaving a £300,000 shortfall, figures have shown

Temi Laleye

By Temi Laleye

Published: 15/04/2024

- 09:05

Updated: 15/04/2024

- 09:42

Miscommunication meant some ex-employees continued to get paid a salary even though they had left the company

HM Revenue and Customs (HMRC) staff have pocketed over £12million in overpayments within the past 10 years, new reports show.

Around 250 employees were mistakenly overpaid by more than £1,000 last year alone.

The employees who received these extra payments were those who had left the company but messages did not get through to payroll to halt their salary payments.

The tax officials have admitted to incorrectly paying staff £12.6million over the past decade. Those affected are now having to pay back what they owe.

Staff have already paid back £12.3million, leaving a £300,000 shortfall, figures from The Telegraph have shown.

Last year, HMRC was overpaid to the tune of £1.1million – with employees paying back just £900,000.


As the new tax year begins Britons are being urged to check their tax code is correct


HMRC is now conducting an extensive investigation to ensure those who were overpaid either have to pay the money back or have it deducted from future salary payments.

Jonathan Eida, researcher at the TaxPayers’ Alliance, said: “Taxpayers will be fuming that tax officials have been filling their pockets with more than they’re entitled to, even if it’s by accident.

“To overpay staff is a shocking error, but even worse is the fact that a lot of the cash hasn’t been clawed back. HMRC’s bosses shouldn’t rest until every last penny has been reclaimed.”

In most circumstances, an employer has the right to claim back money if they've overpaid someone.

They should contact the employee as soon as they're aware of the mistake.

If an employee notices an overpayment in their payslip, they should talk to their employer as soon as possible.

An employer should not deduct money from their employee's wages without letting them know.

The employer should talk to the employee first and agree on how the money will be paid back.

An HMRC spokesman said: “With a staff headcount of almost 67,500, we operate at a monthly payroll average accuracy rate of 99.54 per cent, which exceeds the corporate benchmark of 98 per cent.

“Our total paybill in the 2022-23 financial year was £2.449bn, which means that 0.05 per cent was incorrectly paid that year, and we have recovered over 84 per cent of that.

“Overpayments can occur for various reasons such as delay in reporting someone has left HMRC, breaking a part-year pay averaging contract, late notification of sick leave, or a delay in reporting career breaks/maternity leave.

“We have robust processes in place for the recovery of over and underpayments and all staff are provided with guidance on the importance of checking the payment of their salary.”


As the new tax year begins Britons are being urged to check their tax code is correct.

An incorrect tax code could lead to under- or overpayments in tax, making it important for people to check their code is right as soon as possible.

Robert Salter, director at Blick Rothenberg warned underpayments will need to be paid back, so checking the tax code is right as soon as possible can help to avoid unexpected tax bills.

He told GB News: “An incorrect tax code can result in taxpayers having a significant tax underpayment, which they will then need to pay over to HMRC.

“Such tax demands are never ‘welcome’ or good news and in some cases can clearly cause real financial stress to the individuals concerned.”

You may like