HM Revenue & Customs has paid a recruiter £50,000 after it forced his £1m-turnover business into sequestration (administration), following years of campaigning.

Edward Fowler was awarded the sum after an Ombudsman’s report found HMRC started sequestration proceedings when he was £304.50 in credit through a “procedural error”.

On the 31 October 2002, Fowler received a letter indicating that action would start to recover the debt if payment was not received in
seven days. However, the petitioned debt had been paid “before action had even commenced” and the conduct of the HMRC before and after the action were described as “self-serving and mean-spirited” in the Ombudsman’s report.

Fowler told Recruiter the money was nothing compared to the suffering he and his family had been through. “Once you have had something like this happen to you, starting a new business is not something you can do,” he admitted.

The award was made after Anne Begg, MP for Aberdeen South, petitioned the Ombudsman on Fowler’s behalf.

“It is clear from the Ombudsman’s report that HMRC’s handling of Mr Fowler’s case amounted to complete maladministration, compounded by an inability on the part of HMRC to admit that they had made a mistake,” said Begg.

Ann Abraham, the parliamentary and health service Ombudsman who completed the report, said: “[HMRC] acted with a reckless isregard
for his rights and the consequences of their actions; consequences that Mr Fowler had to live with for five years.”

The HMRC took seven months to notify Mr Fowler of their error, a time-lapse described by the report as “motivated by a desire to defend
their position, rather than any recognition of serious injustice”.

Fowler said that once the situation had deteriorated, he felt he was “coming up against a brick wall” when dealing with HMRC.

He now works part-time as a recruitment trainer in the firm.

HMRC is unable to comment on individual cases.