Tax refund is too good to be true as e-mail rebate proves to be a scam

CONSUMERS were yesterday warned to be on their guard against fraudulent e-mails telling them they were due to receive a tax refund.

HM Revenue & Customs thinks about 20,000 of the scam e-mails have been sent during the past week alone, as fraudsters try to cash in on people's preoccupation with tax in the run-up to the self-assessment deadline.

The e-mails tell people that they are due a tax refund and ask them to fill in an online form giving their bank account or credit card details so that the rebate can be paid. The fraudsters then use the information to either empty victims' accounts or spend up to their credit limit, before passing on their details to other criminal gangs.

HMRC warned consumers not to respond to any of the e-mails, stressing that it only contacts people about refunds by post. It added that it was expecting there to be a "massive upsurge" in the number of so-called phishing e-mails immediately after yesterday's deadline as people waited to hear about genuine tax refunds.

An HMRC spokesman said: "We never use e-mails, telephone calls or external companies in these circumstances. We strongly urge anyone receiving such an e-mail to send it to us for investigation before deleting it."

Last year, HMRC worked with other law enforcement agencies to shut down scam networks in a number of countries, including Austria, Mexico, Korea, the US, Thailand and Japan, as well as the UK. The warning came just hours before the deadline of midnight last night for people who have to complete a self-assessment tax return to submit their form.

By 12pm yesterday a record 6.2 million people had already filed their tax return online – up on the total of 5.8 million people who filed their return in this way last year, which was itself a 50 per cent jump on the 3.8 million people who did so in 2008.

HMRC was expecting about 186,000 people to file their return yesterday as they rush to meet the deadline and avoid a 100 late payment charge. If their form has not been submitted by 31 July they are liable for another 100 penalty. On top of this, they have to pay interest on any unpaid tax, while persistent offenders could face a penalty of up to 60 a day in certain circumstances.

Every year about 10 per cent of the 9.5 million people who have to fill in a self-assessment tax return miss the deadline. But not all of these incur the 100 penalty, as people are only fined if they owe tax.

Last week the Chartered Institute of Taxation (CIOT) said taxpayers could be asked to pay up to 108 a month too much due to incorrect tax codes being issued. The codes tell employees how much their firms will deduct in income tax in the next financial year.

The potential problem arose because of a new computer system. The Revenue said it had no evidence of a widespread problem but advised taxpayers to check carefully.

"There will be some incorrect tax codes as there always are at this time of year," said an HMRC spokesman. "But the coding notice tells people what the code relates to and tells them to contact us if it is wrong."