Group of MPs working to help investment fraud victims ‘encouraged’ after meeting with HMRC

HMRC maintains that it does not tax pension savings which have been lost to fraud.

Earlier this week, the APPG discussed its claims with HMRC and the Treasury, in a meeting it described as “extremely constructive”, adding: “The Treasury Ministers and HMRC indicated a willingness to listen to the key issues and discuss potential proposals for reform.”

Carly Barnes-Short, who represents victims and is chairwoman of the APPG Advisory Board, said: “This is an extremely serious issue. We were given an opportunity to raise our concerns and were encouraged by the meeting. The victims also provided first-hand accounts which have been passed to the Minister to view. There are a number of historic victims really struggling and we are desperately concerned about the position they find themselves in.

“They are currently facing enormous tax bills without any form of support following reports of crimes being committed against them.”

She added that the group is seeking reform of current policy to ensure the UK system strikes a “fairer balance” and focuses on “stopping criminality, rather than holding the victims solely responsible.”

She continued: “We’ve been researching best practice overseas. We believe that the Treasury and HMRC could approach this issue in a different way, much like the US where they are extremely tough on scammers and supportive of victims.

“This is how our system should treat victims of fraud.”

The APPG met with UK Financial Secretary to the Treasury, Nigel Huddleston MP and HMRC’s Director General for Customer Strategy and Tax, Jonathan Athow, on Tuesday of this week.

MP Caroline Nokes, who is co-chair of the APPG, said: “Having heard numerous victim accounts at our recent APPG Inquiry into this issue, I am left in no doubt that they are being failed by our system. I heard harrowing tales of hospitalisations, suicide attempts, insolvencies, nervous breakdowns, marriage breakdowns. These people are victims of fraud, yet have consistently had that fact ignored.

“The Horizon Scandal has brought to the fore the challenges there are in making sure sufficient information gets through the filter of arms length bodies and civil servants to enable Ministers to make informed decisions. This is a similarly serious issue, involving significant injustices and a great deal of harm being caused to many UK citizens.

“That’s why this is a matter to which the government must now turn its close urgent attention and immediately act.”

A government spokesperson said: “We sympathise with people who may have lost money by entering such arrangements and handle these situations on a case by case basis. “We take the wellbeing of all taxpayers seriously and recognize that dealing with large tax liabilities comes with significant pressure.

“ Our message to anyone who is worried about a tax liability is to contact HMRC as soon as possible to talk about options.

“We do not tax pension savings lost to fraud.

“What we do tax are amounts that people release, or attempt to release, from their pensions where not authorised in law.”

Margaret Snowdon OBE, chair of the Pension Scams Industry Group attended the meeting and said: “I am encouraged that the Treasury and HMRC are now prepared to listen.

“We have a lot to do, but this feels like progress.”