The Seniors Guide To Staying Safe Against Tax Scams​

Types of scams

Gone phishing

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.

Types of Scams

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.

Types of scams

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.

Types of scams

Dodgy 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.

Beating the scammers

Know who you're talking to

Be wary of unexpected phone calls or emails, particularly if they start talking about tax refunds or demanding money. Double-check the full email address the message came from. Some of the simpler scams can be picked out pretty easily by a misspelled or random address. Also, remember that HMRC won’t demand or pay out cash this way.

Beating the scammers

Know what they want from you

The real HMRC won’t ask you to put your PIN or passwords into an email. Don’t click links in emails or text messages and never give out your personal information or bank details like this.

Visit HMRC’s official site to see their phishing protection guide. There’s a lot of useful information there on the ways and reasons HMRC might contact you.

Beating the scammers

Watch out for fake websites

It can be tricky to tell a real website from a copycat. You can pick out some of the scammer sites by checking the full web address you’re being asked to click on. Any official HMRC address, for example, should end in “.gov.uk”. Remember to look for the “https://” at the beginning of the address as well. It’s not a 100% guarantee that you’re protected, but at least it should mean that any details you enter will be encrypted against prying eyes.

Beating the scammers

Use proper caution online

This is just general good advice, but it pays to be a little suspicious if you’re unexpectedly contacted about tax. You should be every bit as careful about who you let into your computer as who you let into your home. Keep your operating system up-to-date, and use virus protection. Back up your important files regularly, and keep the backups of anything you can’t afford to lose disconnected from your computer if you can. Set up strong passwords on websites you log into, and don’t use the same password twice. Don’t make any kind of payments or give personal details when you’re connected to public WiFi.

Beating the scammers

Know who you're paying

If you’re making a digital payment, be sure to double-check the details of the people you’re sending the money to. If you’re tricked into paying into a scammer’s account, it can be next to impossible to get your money back. Even your bank might not help you.

There’s a voluntary code that many banks have signed up to that aims to compensate people who’ve fallen victim to this type of “push payment” fraud. However, with an average victim losing £1,387, there was still a £3 billion compensation shortfall as of the start of 2020.

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.