Government to correct war pensions blunder

The Yorkshire Post revealed on Monday that veterans and war widows across the country were told by HM Revenues and Customs (HMRC) that their previously non-taxed pensions would now face a 20 per cent tax.

HMRC originally refused to accept the error and insisted each individual veteran should phone in to have their tax code reversed to its correct status.

But now it has admitted the mistake and said it will be working with the Service Personnel and Veterans Agency (SPVA) to reverse it before the start of the new tax year in April.

This means between now and April the Government must process up to 550 veterans' tax codes a day if it is to reach the tax year deadline.

Former L/Cpl Adam Douglas, 42, head of the Forgotten Heroes charity which supports wounded soldiers who are struggling with the benefits system, said "Although I am pleased that HMRC has relented to public pressure on such a sensitive subject, I can't help but think that this could have been rectified so much sooner, without causing so much concern and upset."

Those affected are disabled former soldiers who claim their allowances under the Armed Forces Pension Scheme (AFPS) which came into effect in 1975.

It is thought that anywhere up to 27,000 veterans received the erroneous letter.