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Tax collectors' one million mistakes

Britain's tax collectors are asking around one million people to pay the wrong amount of income tax, a National Audit Office (NAO) report has shown.The spending watchdog reveals that administrative failings within HM Revenue and Customs (HMRC) led to £125 million in underpayments and £157 million in overpayments in 2006/07.NAO chief Sir John Bourn said "substantial numbers of taxpayers" were being affected by processing errors, especially those with complicated arrangements involving pensions and several jobs or sources of income."Vulnerable groups such as pensioners are likely to be disproportionately affected. The recommendations in my report will help the department build on the work already underway to improve the processing of tax returns," he said.High personnel turnover and the need to process some cases manually led to the errors, the report noted.But, as an HMRC spokesperson pointed out, 95 per cent of all income-tax cases were calculated accurately and the department had improved its overall processing record."We are determined to improve this accuracy even further through better management of tax return processing in our offices and the use of dedicated teams to handle more complex cases," the spokesperson added.

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