Failing to send repayments out on time cost Revenue Service £1.1m.

It paid 'supplements' to taxpayers totalling about £448,000 in 2022 and £631,000 in 2023, after not sending out repayments within 12 months of the date when they were due.

Deputy Steve Falla, who unearthed the figures through Rule 14 questions, said they indicated how bad things still were at the beleaguered Revenue Service.

‘It is public knowledge that the Revenue Service is in some disarray and these figures illustrate the very real consequences of that for the public purse, especially at a time when funding is short in almost all areas of public expenditure,’ said Deputy Falla.

He said that another deputy, who asked for similar information in previous years, had been told that repayment supplements were less than £200,000 in 2021, and were under £50,000 in 2019 – only about 7% of the total paid out last year.

Policy & Resources Committee president Lyndon Trott said the Revenue Service put the increase in repayment supplements between 2022 and 2023 down to two large repayments to companies.

‘This does not justify such a large expenditure of taxpayers’ money due to repayments not being made to individuals and companies within deadline,’ said Deputy Falla.

A supplement is paid by the States where a repayment is due but is not made within one year of the Revenue Service having received a fully completed tax return.

In the opposite direction, surcharges are due to the States when taxpayers fail to pay the Revenue Service on time.

Surcharges were imposed of about £106,000 in 2022 and £154,000 in 2023.

Deputy Falla said he submitted various questions about income tax after being approached by people who had received notification of a £200 fine, apparently for the late filing of tax returns, despite evidence showing that they had submitted on time.

P&R said that about 4,500 late filing penalties were imposed last year and about 4,700 the year before.

However, the senior committee did not know how many demands for £200 were later dropped after the taxpayer had produced evidence of filing a return.

‘Penalties may be rescinded for a variety of reasons, not just where the taxpayer has evidenced submission of a return. Therefore, this data is not available,’ said Deputy Trott.

This left Deputy Falla unimpressed.

‘It is disappointing that the Revenue Service is unable to say how many fines were imposed in error and later rescinded,’ he said.

Deputy Falla also asked about the current backlog processing income tax returns.

By the middle of March, the Revenue Service had assessed 36% of personal income tax returns submitted for 2022, 61% submitted for 2021 and 79% submitted for 2020.

It was further behind with company income tax returns submitted for 2022, having assessed only 16%, but it was further ahead with company income tax returns submitted for 2021 and 2020, at 86% and 93% respectively.