‘I never thought it would come to this...’


Image credit: © IStockphoto/Xesai


Julie Cameron explores the circumstances which drive people to the tax advice charities to seek their help

Sometimes apparently random incidents gel together in one’s mind. And aren’t things meant to come in threes? Or maybe it’s just coincidental that recently, I noticed a magazine piece about our society’s attitudes to bereavement. The writer maintained that death is still taboo; many of us feel awkward around the bereaved, who find it difficult to talk about their experiences when someone close dies. Later that day, I heard Prince Harry admitting it was 20 years before he sought counselling to process his grief on his mother’s death when he was 12. The Prince spoke about the stigma of mental health issues. Finally, I heard about the new Antony Gormley statue at the University of East Anglia; this figure of a man standing on the library roof has caused widespread unease and a petition to have it removed. It seems its position might trigger suicidal thoughts in the minds of pressurised students as they face their final exams this term. Which event, I thought, would leave someone else bereaved.

We will all experience bereavement and might be affected by, or at least know someone with depression, post-traumatic stress, anxiety disorder, or other mental health problems. Such issues can affect anyone at any age and are distressing and debilitating. Take Jim, for example: his mental health issues stemmed from his childhood and led to a drug habit. He is supported by his family and cannot work. Chrissie was unable to work because of stress and anxiety and became homeless after her marriage broke down. Bertha suffers from dementia. Ursula has ME. Ros’s depression was so severe she had attempted suicide. And Hilda, Rachel, Aimee, Marjory and Stephen have all experienced the fallout from the death of a partner.

I expect readers are by now wondering whether this article is in the wrong publication and what, if any, of it has to do with tax. Well, for those named above, their mental health and/or bereavement contributed to difficulties with their tax affairs, resulting in them calling on the tax charities TaxAid or Tax Help for Older People, where they received help resolving escalating tax demands.

They were not deliberately avoiding their tax obligations, but tax compliance hit them out of the blue and they each found themselves at a loss as to what they should do. Jim’s problem was a simple unawareness that he should interact with HMRC. He ignored the brown envelopes because he didn’t understand that he should inform HMRC that the partnership he and a friend had registered some years back had come to nothing. Late filing penalties and determinations piled up to become a debt of £15,000, accompanied by a threat of bankruptcy. This kind of experience, where people are taken on as workers, told they are self-employed and should sort out their own tax, is typical of the situations handled by the tax charities.

Chrissie, on the other hand, managed to keep abreast of her tax compliance until she was made homeless. Thereafter, HMRC could not keep up with her frequent moves between temporary addresses. Add to this Chrissie’s misunderstanding of the complexities of UK residence (she had spent time in Spain and the USA as well as the UK) leading to HMRC rejection of tax returns as incorrect and, once again, late filing penalties mounted up. Homelessness was a contributing factor for Ursula whose ME prevented her from retaining the part time work she needed to secure her benefits.

For the bereaved, suddenly having to deal with the tax system following a partner’s death only adds to their confusion and anxiety, as evidenced by Aimee. She’d had little experience of paperwork, but found herself dealing with her late husband’s debts after his sudden death. Marjory had no idea if HMRC were right when they demanded she repay a tax refund which had been issued erroneously, following changes to her pensions after her husband died. Hilda experienced difficulties with tax following a lump sum payment of deferred pension.

Mental health problems and bereavement are not selective about age, gender or background. Going back to the UEA statue, a thought occurs: if I was standing alone on top of the building, contemplating leaping over the edge, would I be thinking of my tax problems? Ordinary people like Jim and Chrissie were fighting their own demons, which absorbed all their energies and tax compliance was, arguably the last thing on their minds, until HMRC came knocking. The tax charities helped them turn their lives around – as if they’d talked them down from the building. 

The taboo of death and stigma of mental health issues often make it difficult for those affected to open up to others. In these situations, TaxAid and Tax Help are priceless, initially presenting a listening ear via the helpline, followed by practical input and guidance from a case worker. Whether prince or pauper, student or professional, each of us might find ourselves like that roof-based figure, which is why the charities – our profession’s charities – are needed, to help resolve these desperate tax situations.