(Note: Using the nvidia graphics drivers too 304 I believe the version number is.)
Searching the net for ages threw all sorts of weird ways to 'fix' the problem but half were so complex it made my head throb.
On one site I glanced a snippet about the kernel and I remembered that when I installed mint 14 mate on it a few months ago I had to mess about with the HDMI audio.
If you open a terminal and type: uname -r it will display the current kernel installed (cant remember what it was off hand as iv'e now updated)
So what I did was to load in the Update manager, then click the preferences and clicked both boxes for the level 5 updates.
Then click apply and the Update manager will refresh and there should be 3 or 4 updates which are your kernel updates. (should show 3.8.0-26-generic in the names)
Click apply and after a while it completes, I did a uname -r but it still showed the original kernel, so a quick reboot and recheck showed the new kernel.
Updated kernel version: 3.8.0-26-generic
Now when I clicked on the sound icon on the panel and click output device , the HDMI audio output option is now available and works perfectly.
Hopefully that will help anyone who is having problems finding a solution to the problem of trying to find how to get it working without needing to be a genius to understand some of the fixes they will no doubt have found like myself while searching the net.
PS. After the new kernel is installed etc, I went back into the Update Manager and unticked the level 5 update option.
Note: please let me know if this worked for you as a fellow 'Minter' tried but still the HDMI Audio wouldn't work for him, so please leave a comment on if it works or not for yourself.