§ Mr. CoakerTo ask the Secretary of State for Defence if he will make a statement on progress made in discussions between his Department and the Inland Revenue regarding repayment of tax on pensions awarded prior to 31 March 1973 which have been reclassified. [85614]
§ Mr. Doug HendersonThe MOD is working closely with the Inland Revenue on the repayment of tax for the 179 Army pensioners identified as having had tax incorrectly deducted from their invalidity pension. The 213W affected pensioners will all receive a full refund of the tax wrongly paid since their discharge, together with a repayment supplement reflecting the interest which might have been accrued on the amount of tax wrongly paid. The repayment of tax is being processed in three stages: the first stage, the repayment of the current year's tax, has been completed; the second stage covers the period 1994–95 to 1997–98 for which records are held and repayments for this period will be made shortly. The final stage, which covers the period from the individual's discharge date to 1994, is more difficult to calculate as records of pension and tax paid are not held and therefore need to be recreated. This work is under-way and repayment will be made as soon as possible.