HM Revenue & Customs has admitted it has made a number of mathematical errors in its official guidance on pension tax legislation but says it cannot immediately correct the mistakes.
HMRC’s registered pension schemes manual, published in March, contains at least three errors in relation to how much someone can expect to take in tax-free benefits when they are invested in more than one scheme.
The guidance gives an example of an investor who can claim £37,500 from one scheme and £60,500 from another, giving a total figure of £92,500 instead of £98,000.
The second error made in the guidance says 25 per cent of a pension pot of £120,000 would allow a pensioner to receive a maximum lump sum of £27,500, instead of £30,000.
The guidance also suggests that adding together pre- and post-A-Day lump sums of £30,000 and £27,500 would give a saver a total of £60,500, rather than £57,500.
An HMRC spokesman says: “We are sorry about this, the guidance will be updated as soon as possible.”
HMRC only periodically reviews and amends the rulebook and it would not confirm when the next review is due to take place.
Aries Pensions director Gary Chamberlain, who pointed out the errors to HMRC, says: “This is the department responsible for collecting the nation’s taxes and it would seem it has not yet got its GCSE in arithmetic. It is a bit of a shambles.”
Derbyshire Booth Financial Management says: “It does not exactly give you much faith in HMRC does it?”