Taxman demands £900,000 from pensioner living on £11,000-a-year Don Yates received two bills - one for £576,850 and another for £384,567 Demand comes despite 72-year-old living on pension and limited savings Ex-councillor owns a small £80,000 terraced house in Chorley, Lancashire Daughter thought the pensioner was a 'secret millionaire' when bill arrived A pensioner has received a £900,000 tax bill despite living in a small terraced house on a pension and limited savings. Don Yates, 72, said he was stunned when he opened a letter demanding a payment of £576,850.85 - a sum that left his daughter wondering if her father was a secret millionaire. The bill arrived at his £80,000 home in Chorley, Lancashire, just months after another for £384,567.25, which the retired councillor misread as £384 because he had been sick with the flu. Shock: Don Yates received two bills from the Inland Revenue - one for £576,850 and another for £384,567. The demand comes despite 72-year-old living on a pension and savings amounting to £11,000-a-year Despite his hefty tax bill, Mr Yates lives on a pension and savings amounting to just £11,000 a year and says he would need to pay back the enormous demands at a rate of £1 a week. He added that when he showed the bill to his daughter, she asked if his modest lifestyle had been a front and if he was in fact a secret millionaire. Mr Yates, a former Chorley borough and Lancashire county councillor, who was chairman of the county council in 1996-97, said: 'When I opened the first letter I was ill with flu and so I misread it and thought it was for £384.' He added: 'It was only when the second letter came when I realised the bill was far bigger than that.' Adding up: The second demand Don Yates received was for £576,850.85, leaving his daughter wondering if her father was a secret millionaire. He says he would have to pay at a rate of £1 to be able to afford the repayment Extreme: Don Yates owns a small £80,000 terraced house in Chorley, Lancashire (left). The former county councillor (right) says he would have had to sell his home many times over to pay the HMRC demand Mr Yates says he was initially distressed to receive the bill, but a discussion with his daughter helped him not to panic. He said: 'I was very shocked but luckily I had my daughter to turn to and talk it through which really helped me stay calm.' He added: 'I would have to sell my house many times over to even come close to that sum of money so I knew it must be some sort of mistake.' Mr Yates, who was told last January he owed tax of just £529, has been in touch with the Inland Revenue and is due to go and see them to discuss the matter further. A spokesman for HMRC said he could not speak about Mr Yates' case and wouldn't say on how often these kind of errors occur, but added "where we get things wrong we apologise and put matters right."