Staying Safe Against HMRC Tax Scams​

Types of HMRC scams

Phishing Scams

Phishing tax scams are scarily common these days, and they rely on the fact that most people aren’t real experts on HMRC and UK tax law. That means they’re really easy to fall for. You’ll get an email that claims to be from HMRC, often around key tax dates like the 31st of January Self Assessment deadline - although it could be any time. The email looks pretty official, and might even seem to be from a real HMRC address. You’ve apparently got some tax to pay or a tax rebate to claim. Either way, all you need to do is fill in your bank details to get it sorted out. The thing is, HMRC will never contact you this way or expect you to give your banking information in an email. Before you know it, you’ve handed the keys to your savings to a fraudster and your accounts are empty.

Identity Theft

ID theft is related to phishing scams, in that you’re being tricked into handing over sensitive information to insensitive people. That information then allows someone to impersonate you online or elsewhere. The worst part about identity theft is that you’re often made to feel that the details you’re forking over are for your own protection. It needn’t even be as blunt as flat-out asking for your bank account password or credit card information, either. You might be told to make copies of your passport or driver’s licence, or even just a utility bill. They’re basically making you “prove” who you are, then using those same details to steal your identity. That means they can get credit cards, goods or even loans and benefits in your name.

Fake HMRC Texts

This kind of scam is really common these days. You get a text message from the taxman, with either the great news that you’re getting a refund or a dire warning that you owe money to HMRC. Some of these can be really scary, with threats that you’re about to be arrested if you don’t pay up on the spot. The text looks believable, because the sender’s address has been “spoofed” to look like it’s from HMRC. There’ll probably be a link to tap to take you to a realistic-looking website. Again, however they dress it up, all the scammer wants are your bank details and/or personal information, either to use themselves or to sell on to other criminals.

Fake Websites

While we’re on the subject of replica websites, there are some nasty little variants that can easily trip you up if you’re not cautious. When it comes to tax issues, copycat HMRC sites can be a real danger. Watch out for things like fake Self Assessment forms, for instance. Filing Self Assessment means giving up a lot of personal information about yourself and your finances. Make sure you’re giving it to the right people, and never blindly click a link without checking where it leads.

Phone Calls

These calls often come right out of the blue and catch you by surprise. The scammer’s relying on you to be a bit confused, so you don’t think twice before giving them what they want. Again, calls about tax refunds are a really effective way to get people to trust you long enough to scam them. HMRC won’t ever contact you directly this way about refunds, so never give out your information like this.

Common Examples of HMRC Tax Scams

Brexit Scams

We’re all still pretty worked up about Brexit, whichever side of the argument you took. The thing is, panic and chaos are exactly the kind of pressures the scammers thrive on. No one makes good decisions when they’re under stress, so we’re seeing a lot of fraudsters taking the taxman’s name in vain to try and grab your details. People are being told they need to register for a “UK trader number”, for example. As always, all they need you to do is supply a few key details to make the whole problem go away. Of course, by “problem” they generally mean “your cash”.

We’re also finding scammers offering “incredible investment opportunities” arising from Brexit, either to reduce its impact or seize on its supposed windfalls. You might even be told you’re due for a “Brexit severance” payment or something equally magical. Needless to say, you’ll never see a penny of that.

Dangerous Attachments

One of the key ways that scammers will try to get you is with an email attachment. It might be masquerading as an important tax document, or almost anything. The catch is that, if you open it, it dumps a virus or other malware into your system that could do anything from stealing your passwords to killing your computer altogether. One particularly ugly example is the ransomware attack. Basically, when the program runs it locks and encrypts a lot of your files so you can’t open them. The scammer then demands a hard-to-trace payment to unlock everything, usually via something like Bitcoin.

Social Media Scams

This is another pretty popular attack for tax scammers. It starts with a private message on a service like Twitter or Facebook. Suddenly, you find “HMRC” demanding payments or promising instant refunds. Again, the real HMRC won’t ever approach you like this. Don’t reply and never click the links they provide.

Tax Credit Scam

A particularly juicy target for the scam merchants seems to be people renewing their tax credits. That’s when they’re most likely to fall for fake calls or messages from HMRC. You might be told you’re owed a fat tax refund, or that you need to pay back some cash. Either way, all the scammers want is your personal and banking information. They might even try to trick you into making a payment directly to them.

Here’s how to protect yourself:

• Never give out personal or banking details via text message or email. They’re so easy to fake, and HMRC will never ask you to do this.
• Don’t click any links or open any attachments you get in an unexpected message claiming to be from HMRC.
• Don’t get rushed into making bad decisions over the phone. HMRC won’t try to pressure or panic you in a phone call.
• Always report any dodgy calls or messages you get to HMRC. It’s definitely better to be safe than sorry.
• Call your bank if you’ve already fallen for a scam. They can often help. You can also get in touch with Action Fraud.

The Weird Stuff

There are even reports of scams where the fraudsters pretend to be HMRC, demanding a large tax payment in the form of iTunes vouchers. To most people, this probably sounds like a joke, but a surprising number of people are being taken in by it, losing an average of £1,150 each. These scammers tend to attack elderly people, thinking that they’re less likely to realise they’re being conned.

Fixing The Damage

Obviously, if you discover you’ve been tricked by a fraudster, the first thing to do is stop sending them your money. If you’ve set up a Direct Debit, for instance, cancel it by contacting your bank as soon as possible. You can also tell them if someone’s got hold of your PIN or other information.

If you start spotting transactions on your card statements that you don’t recognise, there are things you can do to protect yourself. Let your bank or card provider know the instant you realise something’s wrong. You can get the card cancelled straight away, and in most cases you can reclaim the cash from any fraudulent transactions. If you’ve made payments to a scammer from a credit card, you might have some basic protection. Section 75 of the Consumer Credit Act, for instance, means you can claw back payments of between £100 and £30,000 if the “seller” you’ve been dealing with either disappears or never had what you were buying in the first place. Even if that doesn’t work out, you might still be able to do a “chargeback”, basically reversing the payment. Debit card payments can sometimes be recovered by talking to your bank, but they won’t necessarily all have the same rules and procedures for this.

The rules around bank transfer scams have been going through some changes, hopefully making it easier to get your cash back from a scammer. You might be able to get the bank to reverse the payment altogether, but it’s not always possible. You might be offered only a partial refund - or even nothing at all, depending on the circumstances. If they refuse to help for some reason, it’s probably worth making a complaint – either to the bank itself or the Financial Ombudsman. Getting in touch with the police is also a good idea at this point.

Not all scammers take your money via cards, obviously. There are some pretty convincing PayPal frauds going round as well, for example. Maybe you’ve been directed to a fake PayPal form or payment page. As with any copycat page, it’s easy to find yourself plugging your details in almost automatically. PayPal has a Buyer Protection scheme built in - but with a lot of these scams they’re not involved in the transaction at all, leaving the scammer with your bank details and you in the lurch. Worse still are wire transfer services, like Western Union. These kinds of payments can be next to impossible to recover.