HMRC may have overcharged 107,000 taxpayers after five-year error

The taxman has been aware of the HMRC tax error since 2021Rory Poulter10:17, 04 Sep 2026Thousands of taxpayers face a painstaking manual review of their tax calculations(Image: Nico De Pasquale Photography via Getty Images)HMRC is being forced to go back through 107,000 tax calculations after admitting its computer system may have got the sums wrong. The tax authority has been aware of the problem since 2021, but has not fixed the underlying flaw, according to reports.‌Now thousands of taxpayers face a manual review of their tax calculations for 2025-26 to establish whether they have been charged too much. The problem concerns the way HMRC's systems allocate tax allowances between different types of income. Under tax rules, allowances should be used in the way that gives the taxpayer the l