Anger as system blunder brings tax shock for injured veterans

Simon Neville

HUNDREDS of thousands of injured armed forces veterans are facing uncertainty today after receiving letters saying they will now be taxed on their war pensions.

The letters sent in error to 186,115 veterans and war widows were a result of problems with new computer systems recently installed by Her Majesty’s Revenue and Customs (HMRC).

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But the ex-servicemen are being forced to contact HMRC because the Government department has refused to correct the mistake automatically.

Injured veterans will instead have to contact the department to avoid being taxed at 20 per cent on their pensions.

War pensions are supposed to have an NT (not taxed) status, because they are awarded on a percentage basis to soldiers who sustain injuries in the line of duty.

The Yorkshire Post revealed last week that questions have been raised about doctors who determine the correct levels of disability for ex-servicemen for pensions purposes. Many of the doctors have no experience in dealing with war injuries.

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This latest news will add pressure on the Government to show its support for British troops during and after service.

A former RAF Flying Officer from Leeds, Charley Downey, 31, who is writing a book about the war pensions system, said: “The majority of disabled servicemen and women are entirely capable of managing their own tax affairs, but why should they be the unpaid auditors for the Inland Revenue?

“The people who will lose out will be those too infirm to complain, my associates with head and brain injuries, and those with mental health disorders. And what’s to say that those currently receiving treatment away from home at Selly Oak or with charities such as Combat Stress will even see the letters?

“Raising funds through wrongfully taking money from those to whom our country already owes a debt – this can only be described as immoral, mealy-mouthed and utterly distasteful.”

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Former L/Cpl Adam Douglas, head of the Forgotten Heroes charity which supports wounded soldiers struggling with the benefits system, said he received his letter last week and was shocked when he saw he would be taxed on his pension.

On speaking with HMRC he was informed that there had been computer problems which led to all pensioners receiving letters regarding tax status, including war pensioners who are not taxed on their allowances.

Mr Douglas said: “What about those who are not in a position to call HMRC to rectify it and be placed on hold for 34 minutes like me?

“Those who are under treatment at the moment won’t even know they have been sent a notice regarding their awards and pensions, let alone calling the HMRC to rectify being taxed on their war pension.”

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A Military Families Support Group spokeswoman, Elaine Laga, said she became aware of the problem last week.

She said: “Why are HMRC going to put all these people through so much stress because of their own error?

“Not everyone will be in the position to call up and hold for all that time. The people who won’t be able to make the calls are the ones in the worst position and need the most help.”

Tory Shadow Defence Secretary Liam Fox said: “Providing our brave veterans with a war pension is one of the pillars of the military covenant and it is shocking that now some veterans are being asked to re-establish their tax status with Revenue and Customs.

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“Whether this is a tax increase or some kind of error, it is simply unacceptable to burden our veterans, many of whom are disabled, with this kind of difficulty. I urge Revenue and Customs to quickly sort this out.”

A spokesman for the Service Personnel and Veterans Agency (SPVA) said they were aware of the problems and had had ex-servicemen contacting them.

Anyone receiving a war pension who is concerned can call the SPVA helpline on 0800 169 2277.

An HMRC spokesman said anyone in a situation where they felt they had the wrong tax code should contact the department. He added that the new computer process “would significantly reduce both over- and underpayments”.

Comment: Page 10.

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