Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner.

Raw Deal: Don’t allow firms to tax a rebate… Expert warning on extra charges

© Shutterstock / Piotr SwatHM Revenue and Customs logo displayed on mobile phone.
HM Revenue and Customs logo displayed on mobile phone.

Consumer watchdogs are warning Scots to beware of firms which charge fees for helping people with their tax rebates.

HMRC is giving millions of pounds to firms that can charge unwitting taxpayers hefty fees for claims that are free to make in person.

People who used these third-party firms have complained they were unaware they would lose huge sums to fees, while others have reported difficulties in getting their share of the rebate back from them.

From the married couple allowance to tax relief for working from home, there is a rebate company to cover just about everything.

Katherine Hart, lead officer for doorstep crimes and scams with the Chartered Trading Standards Institute in Scotland, cautioned that not only do these third-party firms pull people in by appearing at the top of internet searches and having prominent advertising on social media channels, they also call potential customers by phone with attractive-sounding propositions.

“What these firms are doing by collecting tax rebates on people’s behalf isn’t against the law,” she said.

“But while it can seem convenient to have someone else make a claim for you, you could end up paying through the nose. We have come across some third-party claim companies who charge 50% commission or more to get tax rebates people could have claimed themselves for nothing.

“What seems like a time-saving service at first, can soon turn into an expensive world of hassle.”

Raw Deal has received a number of letters of concern from readers targeted by such firms.

A retired police officer from Aberdeenshire – who asked not to be identified – said he felt “foolish” after signing up to third-party tax company Ensign Advisory Ltd.

In June last year he answered an advert on Facebook to reclaim marriage tax allowance from HMRC and submitted details for himself and his wife.

“I received a text in reply telling me to sit back and relax whilst they did all the work for me. It sounded good and a check for the company revealed them to appear to be a genuine one.

“Within weeks, I received a letter from HMRC informing me they had sent a cheque to Ensign Advisory Ltd for £718.53.

“I then had several months of being asked by the company for various documents to prove my identity and in January I eventually received a cheque – but £401 had been deducted in fees.”

The reader said he was later advised by HMRC that another rebate was due and that this too would be paid to the third-party agent. He then had to get the tax office to cancel this arrangement.

He said: “I feel foolish for signing up to this service, but it all seemed so convenient at the time.”

HMRC said: “We encourage customers to come to us directly to make their claims.

“The same information is needed whether you apply via an agent or directly yourself. It only takes a few minutes to complete our online application and you get to keep all of what you are due.”

Ensign Advisory said it could not comment on individual customers’ tax claims. But it said its charges – 42% plus a £100 administration fee – were made clear on its website and that all customers had to acknowledge they had read its terms and conditions.

It said: “Our website and claims process offers more than enough transparency in order to ensure customers are made aware of our entire business process and therefore feel confident in standing by our stringent process. Our fee structure is clearly outlined and explained in our terms and conditions.

“We therefore trust that our customers have understood and acknowledged our terms and conditions.”