§ Mr. Andrew Mitchell
To ask the Chancellor of the Exchequer what arrangements the Inland Revenue is making to handle the increase in repayment claims which will result from changes in the taxation of bank and building society interest.
§ Mr. Maude
The Inland Revenue has undertaken an extensive publicity campaign to encourage all those who are eligible to register for payment of bank and building society interest without deduction of tax and so avoid the need to claim a repayment. Nevertheless, in the year 1992–93, the Inland Revenue needs to plan for a substantial increase in claims to repayment of tax deducted at source from interest and other investment income. The numbers are inevitably very uncertain, but could be well over 10 times the present annual total of around 800,000 claims.
It is likely that a high proportion of the claims will be made in the period from April to July each year. The Inland Revenue has had to look for a balance between the standards of service it can offer and the need to spread the work to some extent over the year, in order to keep costs down to a reasonable level. I have decided that the Inland Revenue should base its planning on the principle that the time taken to deal with any claim should not exceed three months. The Inland Revenue is setting up 24 new offices around the country to deal with the work. They will, of course, try to keep the time taken to process a claim to the minimum. But there may be occasions, especially in the period from April to July, when the volume of claims received makes it impossible to process them without delay.