Thousands Sent Wrong Tax Details In Ministry Of Defence Error

The MoD has had to withdraw and reissue letters to individuals who breached the Annual Allowance tax threshold after it was found that they contained a ‘significant’ error.

An error in the letter could have cost service personnel if it had gone unnoticed.

The letter titled: ‘About your Pensions Tax Annual Allowance for Tax Year 2016-17’ dated 30 September 17 has been sent to at least 2,397 service personnel.

An initial correction from the MoD said it had “undervalued tax charges and carryover of annual allowances.”

“An incorrect Consumer Price Index (CPI) percentage has been used to calculate Annual Allowance (1% instead of 0%).”

Service personnel have been advised not to submit their annual tax returns until they receive a corrected letter.

Corrected letters are being sent to anyone who got the erroneous letter ‘as soon as possible’.

John Pitt-Brooke, General Secretary of the Forces Pension Society said: “This is a very significant bit of financial information provided at this time of year to those with a particular tax liability, and the MoD got it wrong.”

He said: “This is vital tax information for many serving personnel, and had the mistake gone unnoticed they would have filled in their tax returns falsely.

“It’s not just the 2,400 – this was the first tranche of letters and the same mistake (use of the wrong inflation rate) would have been made in all the other letters.

“We in the Forces Pension Society spotted this and told the MoD who promptly withdrew the 2,500 letters.”

Service personnel have been asked not to contact the Joint Personnel Administration Enquiry Centre.

The corrected letters will explain the reason why the letter dated 30 September 2017 should be destroyed.

Has the mistake led to you submitting your tax returns incorrectly? Let us know in the comments.