The error was caused by a glitch in the Revenue and Customs’ tax system used by the UK’s largest employers.

A Revenue spokesman said it did not know how many of the 4.7m notices suggesting people pay 371 had been sent out in error.

Payroll expert Karen Thomson says the total affected could be 700,000, including many teachers and nurses.

Speaking to BBC Radio 4’s Money Box programme she said: “On average the Revenue produces four million of these notices a year.

“They have confirmed to us that this year 4.7m will go out to the end of January, so the difference, 700,000 notices, could be incorrect.”

The Revenue challenged this methodology because “there are so many variables” but would not offer an alternative nor confirm or deny that figure.

But Money Box has evidence that the problem is widespread.

The programme has been contacted by teachers, doctors, other NHS workers, librarians, people who work at Gatwick, for EDF Energy, for Boots the chemist - even someone who works for HM Revenue & Customs.

And if one person in the company gets the notice, the rest are likely to as well.

Angry workers

Susan Millington, payroll manager at Tameside Borough Council in Liberty national insurance which employs 11,000 people, said: “We have had well over a thousand calls. People are very cross.

“We were told by the Revenue they were aware of the error but they can’t do anything to stop it. I just couldn’t believe it.”

I am really shocked, amazed, it’s really worrying Keith Parry, council worker Read your comments

Keith Parry works for Tameside. He said all his national interstate insurance company
had received the letter which suggests they pay 371 to “make up the shortfall and protect your entitlement to basic State Pension”.

He rang the helpline and spoke to a Revenue official who “immediately said that it was entirely caused by the Revenue, some sort of computer error and said some two and half million people were involved”.

“I am really shocked, amazed, it’s really worrying,” he said.

A Revenue spokesman denied that figure was correct and said it was working through the large employers affected and will eventually be sending letters to all those who have received the notice in error.

The problem began after the Revenue told all employers with more than 250 staff to file their 2004/05 pay returns electronically.

The Revenue’s computers could not cope, dropped information and missed National Insurance contributions.

Another computer then sent out letters informing coast national insurance
they had a gap.

Karen Thomson says anyone who has been in work for the whole of 2004/05 should not pay until the position has been clarified.

If there is a shortfall, they have until 5 April 2011 to pay the extra contributions. The letters have a helpline number for those who are concerned.

BBC Radio 4’s Money Box will be broadcast on Saturday, 16 December at 1204 GMT and Sunday, 17 December at 2102 GMT.

Alongside a fondness for using statistics to support his claims and his weakness for using those dreaded words ‘prudence’ and ‘fairness’, he has laid great emphasis on using the tax system to encourage enterprise.

He also used recent Budget statements to rail against what he sees as the tax avoidance industry and those who do not pay ‘the right amount of tax’.

While the headlines will focus on the cut in income tax from next April, in this his eleventh and most likely final Budget statement, he once again picked up on these two themes.

While the main focus of his statement was, as had been widely expected, increased spending on education and support for families, there were some very interesting changes announced for both small and large businesses.

For large businesses, he announced a cut in the rate of corporation tax from 30% to 28% from April 2008.

The intention here, of course, is to help to persuade the very largest, international businesses to stay in the UK, following speculation that high tax rates were leading many to consider setting up shop - or bank - elsewhere.

There has been much criticism of the existing system of capital allowances, primarily because of its complexity Budget reaction in Scotland

But the rate applies not just to large companies but to all companies with significant profits. So this will be widely welcomed.

At the same time, there are to be significant changes to capital allowances.

These are the allowances that businesses can set off against their tax bills when they spend money on capital expenditure - a new machine, for example.

There has been much criticism of the existing system of capital allowances, primarily because of its complexity.

Under the banner of american national insurance
capital allowances, he proposes to simplify the system - so that allowances for spending on plant and machinery will be a standard 20% each year, for example - while at the same time national life and accident insurance enhanced allowances for ohio national life insurance friendly assets.

Mr Brown announced a cut in the rate of corporation tax

There will also be increased help for company spending on R&D, seen as the foundation of the innovative Britain that Gordon Brown has placed such emphasis on fostering.

But tax avoidance was sure to appear in some form. Under the heading of ‘artificial company insurance integon national
of small business’ there are to be measures to tackle what he sees as illegitimate tax avoidance.

In recent times many thousands of small businesses have converted to limited company status, taking advantage of the low rate of company tax of 19%.

This rate will now increase each year by 1%, taking it to 22% by 2009 - not far below the new large company rate of 28%.

A reference to aligning National Insurance rates also seems likely to be targeted at those same tax avoiders.

The vast majority of UK companies, however, are small companies.

So they will all see an increase in their tax bills, just when the fall in income tax comes into effect.

Once the dust settles and we all have a chance to digest the detail behind the Budget speech, I suspect that the extra tax burden on small businesses will be the focus of a great deal of attention.