HMRC leaks migrant data to UK Home Office in breach of trust
An FOI, submitted by the Migrant Rights Network [MRN] – an organisation working on cases of highly skilled migrants refused permanent residency visas over “minor tax errors” – found HMRC shared data belonging to 462,000 migrants with the Home Office between 2015 and 2020.
MRN’s senior advocacy officer Katharine Thane told The New Arab it is “no coincidence” that since 2016, some 1,697 applications for the visa made by ‘highly skilled migrants’ on a Tier 1 Visa were refused.
[The] minor errors the Home Office flagged on migrant tax returns are neither an immigration or criminal matter, and are thus unfounded principles upon which to refuse visa applications
The Tier 1 visa scheme – which promised highly skilled migrants they could apply for Indefinite Leave to Remain (ILR) after working in the UK for five years – was established under Labour in 2008, but shelved by Theresa May in 2014 in a bid to reduce net migration figures.
But legal professionals have questioned the government about claims its data-sharing powers are “unlawful”.
In a letter to the Secretary of State seen by The New Arab, tech justice team Foxglove demanded a copy of a legal document to show the Home Office appropriately assessed the impact of sharing this data before doing so. It also highlights that minor errors the Home Office flagged on migrant tax returns are neither immigration nor criminal matter, and are thus unfounded principles upon which to refuse visa applications.
But Home Office judgements of “bad character” and “dishonesty” for tax errors were made under immigration clause 322(5) – a rule usually preserved for criminals, terrorists and those who are a threat to national security.
Foxglove lawyer Rosa Curling wrote there is “no lawful agreement” to allow data sharing between HMRC and the Home Office, and that application of clause 322(5) is “discriminatory, breaching the Equality Act.”
The letter, sent in June, flagged up recent Court of Appeal rulings (Balajigari, 2019 and Yaseen, 2020), which already declared the “Home Office had been acting unlawfully” in its application of clause 322(5).
Curling states such rulings affirmed migrants should be given an opportunity to explain errors on tax forms, and that the Home Office “must engage in a balancing exercise” that takes account of children; positive contributions of migrants to the UK; and “specific circumstances” that led to the alleged misconduct.
She also questioned government data protection obligations by referencing a ‘memorandum of understanding’ between HMRC and the Home Office, which allowed data sharing “if an immigration offence is suspected.”
She added: “Tax discrepancies are neither an immigration nor criminal offence, and HMRC itself did not pursue them as an issue at the time of filing.”
We contacted the Home Office about its current access to HMRC migrant data and were told: “If people are found to be abusing our rules, the public rightly expects we take robust action. We found 88 percent refused under paragraph 322(5) claimed their earnings were £10,000 a year higher than shown by their tax records. In fact, the average was £27,600 so it is wrong to claim these are small mistakes in tax records.
“Our visit visa streaming tool is fully compliant with equalities legislation, so to suggest otherwise is completely false.”
But according to Thane, the tax owed by errors is only “20 percent of what discrepancies are claimed to be.” She said this means the £10,000 figure cited by the Home Office is “inaccurate.”
“The Home Office is fighting over is a small amount of money. Many had already set up plans to pay it back but their corrections on tax forms are deemed dishonest.”
She said errors were made when migrants completed British tax forms for the very first time in 2010/11, often with the help of accountants. But she said these errors were not flagged up not until ILR applications were made in 2016.
Data collated by MRN [Migrant Rights Network] found over half the applicants refused are of Pakistani descent and over 70 percent identify as Muslim. Thane told TNA evidence shows all those refused ILR [Indefinite Leave to Remain] for historic tax errors were 'non-white' applicants
“Many are not given a chance to explain reasons for amendments to errors. But the Institute of Fiscal Studies has found some four million British citizens make similar tax form errors on a regular basis, so this only looks like an excuse to refuse ILRs.”
Highly skilled migrants refused ILR originate from places including Pakistan, India, Bangladesh, Sri Lanka, Nigeria and Zimbabwe.
Data collated by MRN found over half the applicants refused are of Pakistani descent and over 70 percent identify as Muslim. Thane told The New Arab that evidence shows all those refused ILR for historic tax errors were “non-white” applicants. In one case, she added, the tax discrepancy was as little as £1.20.
The government has said allegations of racial profiling when processing applications are not true. But in August 2020, a legal action launched by Foxglove forced the government to scrap a ‘racist visa algorithm’ which graded visa applicants using a ‘traffic light system’ ranking ‘suspect nationalities’ with a red label.
Avis Kawos, 40, from Kashmir, India, said he arrived in the UK in 2007 and paid “substantial fees” to study before qualifying as a physiotherapist and landing a job with the NHS for five years. Despite being invited to apply for the visa to remain indefinitely in the UK, he is one of many highly skilled migrants refused entry over a minor tax error on his form.
Kawos told The New Arab: “When I made the amendment, the tax was actually zero so I didn’t owe them anything. It was an honest mistake but I was told I am deceitful and dishonest.”
As a result, Kawas, his wife and their two small children returned to India in 2017, thinking they would not come back to the UK again. But in 2020, the family was able to return when Kawas was given a three-year visa after being offered work with a private company contracted by the NHS. “We are still fighting to stay. This is our home, my children grew up here, but we are being treated like criminals over nothing.”
While the future is uncertain for Kawas, he is still able to work thus survive for the duration. But Thane said this is not the case for 55 percent of ILR applicants with no right to work or rent property, and no recourse to public funds, meaning some applicants are either homeless or destitute.
She added: “If people were found to be abusing rules, there was no evidence of investigating the causes before the ILR was refused.”
She said even when skilled migrants are cleared of dishonesty, they are still made to reapply for ILR again, costing tens of thousands of pounds, giving the impression refusals are becoming “a money-making scheme.”
But a minor tax error was not the only reason the Home Office refused the ILR application of NHS IT engineer Farrukh Sair, 40, who is married with two children and has lived in the UK for 17 years.
Sair, who has been a frontline NHS worker throughout the pandemic, told The New Arab how administrative blunders and unlawful rulings have continued to have repercussions on applications he made for a post-study work visa in 2008 and ILR in 2015.
“I was told I needed to have £800 in my bank account for three consecutive months, but I didn’t know this rule so they refuse my application. I had to go back to Pakistan to re-appeal in 2009. Finally, they grant me a visa but by the time they return my passport, I had been out of UK for more than six months, so I had broken another rule without having any choice in that matter.”
Sair said the Court of Appeal found the £800 rule to be unlawful anyway, meaning he was refused and made to appeal for no reason and then penalised despite being forced to stay out of the UK through no fault of his own.
In 2018, Sair lost his right to work in the UK and had no recourse to public funds either, depending on family and friends to survive. In 2019, he applied for ILR but was refused over a minor tax error, and again, because of the six-month rule. He told The New Arab: “A refusal letter warned we would be deported or detained if I didn’t appeal.”
The situation has brought attention to latest government proposals to further digitise the so-called hostile environment with the escalation of current data sharing powers
The Court of Appeal ruled the Home Office decision to refuse Sair’s ILR was not proportionate. But while this news was welcomed, the case was referred to another court. On Wednesday, it ruled that while Sair had not been “dishonest” about his tax affairs, he should be “responsible” for them; and that the Home Office had been “inconsistent” in dealing with his case and should deliver a decision on his ILR at the earliest.
The situation has brought attention to the latest government proposals to further digitise the so-called hostile environment with the escalation of current data sharing powers.
New proposals by the National Fraud Initiative [NFI] – a sub-section of the Cabinet Office – were made for the detection and prevention of crime and for identifying individuals in debt to public bodies following the impact of Covid.
Sahdya Darr, immigration policy manager at the Open Rights Group, says such new powers will be “tantamount to providing a search engine for police to seek out migrants.”
She told The New Arab that expansion of NFI powers “disproportionately intrude on fundamental rights” so should also concern those opposing the controversial Police, Crime, Sentencing and Courts Bill, which handed new powers to police for tackling demonstrations.
Data rights expert Chris Pounder told The New Arab there are other issues at stake too because the government’s draft code explicitly states data sharing will provide “intelligence” on individuals and “economic incentive” by providing data access to private organisations like credit reference agencies.
He said new rules could also mean NHS Hospitals are obliged to disclose patient data by law, making insignificant certain data protection safeguards (namely, Data Protection Impact Assessments) as data sharing will be a legal requirement.
Pounder added new data-sharing proposals also fail to mention Article 8 of the Human Rights Act, which protects against “unnecessary surveillance” and “intrusion.”
NFI documents state the government already holds more than 300 million data records collected from 1,300 public and private organisations, and span health records to bank details – information which can be matched with lists of those registered as migrants.
Data matching powers first came into effect in 1998 when they were introduced under the Audit Commission Act. But according to Pounder, they have not been reviewed by Parliament since, even when they were enshrined “with little debate” in 2014 under schedule 9 of the Local Audit and Accountability Act.
Pounder describes government tactics to access “any data it wants” as “mafioso” and “uncompromising.” He said the proposals show no mention of the right to refuse when organisations are asked to provide non-mandatory data, meaning they are likely to disclose it even if they are within their rights not to.
The New Arab has contacted the Cabinet Office about data protection safeguards and how they fit in with new NFI proposals; and is awaiting a response from HMRC and the Home Office regarding the letter from Foxglove.
Anu Shukla is a freelance journalist based in London.
Follow her on Twitter: @AnuShuklaWrites