Wise is attempting to negotiate a settlement with HM Revenue & Customs after software failures caused some investment customers to pay too much or too little tax during a four-year period.
The money transfer app contacted about 4,000 UK users of its Wise Asset service — in which customers have invested $9bn globally — this week to say it had provided them with incorrect tax statements between 2021 and 2025.
In an email seen by the FT, the company said it was in talks with HMRC about a “bulk settlement” to cover any shortfall in taxes arising from the error, which was caused by a third-party supplier. It would compensate customers who had overpaid, it said.
Wise said the issue stemmed from miscalculations made by its third-party software on the sums people had earned on their stocks and fund investments — which must be declared to HMRC.
The error meant that about 4,000 users were given incorrect capital gains and income figures to declare in their self-assessment tax returns. Not everyone who received an incorrect tax statement would have paid the wrong amount of tax, it added, due to changes in customers’ personal circumstances.
The company said: “Wise identified that errors in software used by a third-party provider led to incorrect tax statements for a limited number of customers using our Wise Interest and Stocks investment products.
“We have fixed the issue, issued corrected statements to affected customers and are proactively redressing potential liabilities, with no ongoing risk to customers.”
The error is the latest issue for Wise, which has this year faced scrutiny over its money laundering controls and compliance functions. In June, it emerged that Belgian authorities were investigating the company over potential money laundering offences and whether its accounts were used by international criminal groups.
The following month the fintech’s application for a US banking licence was rejected by regulators because of “deficiencies” in the fintech’s anti-money laundering checks.
Wise, which has 19mn users globally, was founded in 2011 by Taavet Hinrikus and Kristo Käärmann.
Käärmann, Wise’s chief executive, was fined £350,000 by the UK financial regulator in 2024 for breaching conduct rules and failing to notify them of “significant tax issues”.
Wise launched its Assets service in 2021 in an effort to diversify from the cheap or free money transfers that it specialised in. It began by offering stocks and later added an interest option, which offers investments in government-guaranteed short-term assets like money market funds.
Wise was a darling of the UK fintech sector and listed in London in 2021 at an almost £9bn valuation. But it shocked the City last year when it decided to shift its primary listing to the US.