HM Revenue & Customs (HMRC) will not prosecute or fine former clients of a Suffolk accountancy firm over their tax refund disputes, it has emerged.
Several MPs met with HMRC on Wednesday, May 10, as clients of Apostle Accounting, based in Stowmarket, have been instructed to repay tax rebates they had received years prior.
The clients have been contacted by HMRC in recent weeks with orders to repay the money as it had been incorrectly refunded, with several owing thousands of pounds.
Apostle has blamed HMRC for the issue, while Central Suffolk and North Ipswich MP Dr Dan Poulter said the clients have been "caught up in this affair through no fault of their own".
It has now been confirmed the tax authority will not be seeking prosecutions or imposing fines on the affected former clients.
A number of former Apostle clients contacted this newspaper in April after receiving letters from HMRC instructing them to repay tax refunds recieved through the accountancy firm from several years ago.
The clients said they had previously used Apostle to claim a tax refund – with the firm taking a 20% cut – but said they were left in the dark over what was being claimed for on their behalf.
It is believed there are hundreds of clients facing having to repay their tax refunds, with a Facebook group consisting of more than 1,000 people launched.
When the issue first came to light, Apostle, which was founded by Zoe Goodchild in 2012, said it was taking the matter "extremely seriously" and believed the cases "showcase an incorrect application by HMRC officers of its own rules/guidance".
Dr Poulter and Ipswich MP Tom Hunt, as well as several Norfolk MPs, wrote to HMRC in late April to express their concern over the matter after constiuents came forward.
It was later confirmed by Suffolk police that officers and other agencies were investigating Apostle, which is based in Marriotts Walk in Stowmarket, over a "large number" of fraud allegations.
Dr Poulter said he was pleased with HMRC was not planning on prosecuting or fining former Apostle clients facing paying significant sums.
He said: "In what has undoubtedly been a very distressing situation facing many people across Suffolk and further afield, I am pleased that HMRC have agreed they will not be taking action to prosecute or fine individuals who were clients of Apostle Accounting.
"Whilst I understand that HMRC will not comment regarding individual investigations, I am hopeful that they will give due consideration to thoroughly investigating this matter.
"I shall continue working hard on behalf of residents in my constituency, and elsewhere, who have been caught up in this affair through no fault of their own."
A statement from Apostle said: "We noted the recent announcement by MPs of their intention to meet with HMRC to discuss these matters and welcome what we recognise as a further step towards achieving a positive outcome for our former clients.
"With HMRC having previously closed its own investigations into these matters, having found our approach to be acceptable, today's reports that they will not be pursuing any prosecutions or adding any extra fines onto our former clients represent another step forward.
"However, we share the view that investigations must continue in order to reach a positive outcome for our former clients, and we welcome the opportunity to work with MPs and other relevant authorities and stakeholders, in pursuit of that.
"Throughout the process, and from the first demands being made by HMRC, we have sought to co-operate and support our clients in challenging these demands, and have also approached MPs to discuss forming a collaborative approach on behalf of former clients.
"We maintain that all rebate claims were made and awarded within HMRC rules and in no way accept liability for payments HMRC may be seeking from our former clients."
A spokesman for HMRC said: "We offer support to anyone who owes money, including the possibility of paying it back in installments.
"We had a constructive meeting with MPs and we’ll continue to work with them on this matter."
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