posted 9th December 2025
What Can Be Done When HMRC Fail to Follow Due Process – And How You Can Recover Money Owed
Most taxpayers assume HMRC always follows correct procedures during investigations, compliance checks, and debt collection. In reality, HMRC frequently makes procedural errors, some of which can invalidate assessments, reduce penalties, or even entitle you to repayment.
If HMRC has acted unfairly, exceeded its powers, or failed to follow due process, you may have legal grounds to challenge their decisions and recover money paid incorrectly. Understanding your rights is crucial, because HMRC rarely admits mistakes unless challenged.
What Does “Failure to Follow Due Process” Mean?
Due process refers to the legal framework HMRC must follow when issuing assessments, penalties, information notices, and enforcement action. When HMRC fails to meet these obligations, its decisions may be invalid or unenforceable. Common examples of HMRC failing to follow due process include:
Get Help With Unjust HMRC Treatment Today.
1. Issuing Incorrect or Invalid Assessments - An assessment may be invalid if:
- It was issued outside statutory time limits
- The behaviour classification (careless/deliberate) is unsupported
- The assessment is not based on reasonable grounds
- HMRC did not explain how the figure was calculated
An invalid assessment can often be withdrawn entirely.
2. Not Giving Proper Notice or Explanation - HMRC must make clear:
- What information it is requesting
- Why it is requesting it
- How the amount was calculated
- The taxpayer’s rights to appeal
If HMRC fails to inform you properly, their actions may be procedurally flawed.
3. Unlawful Use of Information Notices - Schedule 36 notices must be proportionate, relevant, and legally justified. HMRC cannot:
- Demand excessive records
- Request documents they already hold
- Access third-party data without proper authority
- Incorrectly issued notices can be overturned.
4. Incorrect Behavioural Classification
HMRC often incorrectly labels behaviour as “deliberate” when the evidence only supports “careless”. This dramatically increases penalties — and is challengeable.
5. Failure to Offer Statutory Reviews or Appeal Rights
If HMRC does not offer a formal internal review or explain your appeal rights, the entire decision process may be defective.
6. Making Assumptions Rather Than Evidence-Based Decisions
HMRC must base assessments on reasonable assumptions, not speculation. Excessive estimates can be legally disputed.
7. Enforcement Action Without Proper Notice
Bailiff visits, payment demands, or bank account freezing orders must follow strict procedures. Mistakes here can make enforcement invalid.
What You Can Do If HMRC Have Not Followed Due Process
Taxpayers have several powerful remedies when HMRC acts outside the law or fails to follow proper procedure.
1. Request a Statutory Review
You have a legal right to request an internal review by a different HMRC officer. Reviews often overturn incorrect decisions, especially when procedure has been breached.
2. Lodge a Formal Appeal
Appeals can be made to the Tax Tribunal (First-tier Tribunal). Many appeals succeed when HMRC’s process has been defective, unreasonable, or unsupported by evidence.
3. Submit a Complaint or Maladministration Claim
If HMRC’s actions caused financial loss or distress, you may be entitled to:
- Compensation
- Reimbursement of professional fees
- Repayment of tax wrongly collected
HMRC has an internal complaints process, but serious cases may be escalated to the Adjudicator’s Office or the Parliamentary and Health Service Ombudsman.
4. Apply to Have Penalties Reduced or Cancelled
If HMRC wrongly classified behaviour or issued penalties without justification, penalties can be:
- Reduced
- Suspended
- Removed entirely
A procedural error often invalidates the penalty automatically.
5. Request Overpayment Relief
If HMRC’s mistakes caused you to overpay tax, you may be entitled to a refund — even years later. Overpayment relief claims must be detailed and well-evidenced.
6. Challenge HMRC’s Use of Estimated Figures
If HMRC used unreasonable estimates, these can be replaced with accurate figures. This often leads to significant reductions in tax and interest.
7. Seek Expert Representation
HMRC rarely admits procedural errors unless professionally challenged. Independent specialists can:
- Review HMRC’s actions
- Identify where the process was flawed
- Build a formal challenge
- Recover overpaid tax or penalties
- Prevent further escalation
For many taxpayers, professional intervention is the difference between success and failure.
Can You Get Money Back from HMRC When They Get It Wrong?
Yes — and more often than most people realise. You may be entitled to repayment if:
- An assessment was invalid
- Penalties were miscalculated
- HMRC classified behaviour incorrectly
- Interest was applied wrongly
- Enforcement action caused financial loss
- HMRC failed to follow statutory procedure
- You paid tax based on incorrect assumptions
In some cases, compensation is also payable for stress, delays, or poor handling. The key is having the case reviewed properly. HMRC will not simply refund money unless a formal challenge is made.
If you believe HMRC has made mistakes or failed to follow the correct process, you are not powerless. At Tax Investigation Helpline, our independent experts specialise in challenging incorrect HMRC decisions, reversing unfair penalties, and recovering tax that should never have been charged. We deal directly with HMRC on your behalf and ensure your rights are fully protected. Contact us today for confidential, expert advice and let us put you back in control.
