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Tax
credits news and developments
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25 April 2008 |
New
tax credit article
Frontline
67 has an
article on the new code of practice for tax credits.
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24 April 2008 |
New
benefit and tax credit rates
The
2008-2009 benefit and tax credit rates are now online as a text
version
or a PDF.
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27 September 2007 |
Court
action on tax credits
causes hardship,
says Citizens Advice
In
July this year, the Chancellor of the Exchequer Alistair Darling, informed the
House of Commons that errors in tax credit overpayments were at an estimated £6.6
billion.
As HMRC is now pursuing many vulnerable people through the courts
for overpayments, this will inevitably leave many of the people most at risk in
society facing severe financial hardship.
The
administration of tax credits remains the biggest single policy issue for
Citizens Advice in Northern Ireland. The main issues are the overpayment of tax
credits, lack of local contact within Her Majesty’s Revenue & Custom (HMRC)
and a lack of internal communication between the different HMRC departments
leading to inaccurate information provision.
Citizens
Advice made several recommendations to the House of Commons Treasury-Sub
Committee including the reinstatement of local customer service contacts to
provide a caseworker type approach to solving problems, especially in the case
of a complex issue. Citizens Advice also recommended that HMRC should issue and
award service delivery contracts to the voluntary advice sector for face-to-face
advice to the public on tax credits.
The Chief Executive of
Citizens Advice Derek Alcorn said:
“Many
families who are trying to engage with HMRC and to pay back arrears are being
caused unnecessary hardship because of the administrative confusion surrounding
tax credits. We have asked HMRC to restore the customer service unit to
Northern Ireland
that was moved to
Liverpool
and to recognise the pressure that is being placed on ordinary people and
advice agencies.”
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5 September 2007 |
New tax credit notes
Tax
credit notes in the Law Centre's Encyclopedia of
Rights have been updated and are available here.
The notes cover:
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Working
Tax Credit |
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Child
Tax Credit |
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Calculating
Tax Credit |
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Claiming
Tax Credit |
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Decisions |
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Changes
in Circumstances |
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Working
Tax Credit run on |
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Payment |
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Offences
and penalties |
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Appeals |
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Transitional
arrangements |
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18 April
2007 |
New benefit and tax credit rates now
online
These are available
here as a PDF. A
text version will be available soon.
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10 April
2007 |
Rightsnet tax credit website
www.rightsnet.org.uk/taxcredits
brings together resources needed to keep up to date with the latest tax
credit legislation, guidance and case law. it includes forms, leaflets, fact
sheets, calculators and a tax credits discussion forum.
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27 October
2006 |
Errors and delays lead to more
than £¾ million in compensation
Over the last year the Revenue has paid
tax credit claimants compensation worth more than £¾ million, the
Paymaster General, Dawn Primarolo, has confirmed.
Whilst the design of the tax credits
computer system is accepted as being a major contributing factor to the
problems that HMRC has experienced - that, for example, resulted in tax
credits worth £2.2 billion being overpaid in 2003/2004 - Ms Primarolo
told the House of Commons that the performance of the tax credit
computer system is now stable and delivering 'flexible, responsive tax
credits to 6 million families'.
However, the Paymaster General also said
that between October 2005 and September 2006 compensation payments of
approximately £782,700 - an average of more than £65,000 a month -
was paid in recognition of the worry and distress caused by HMRC errors
and delays in dealing with claims.
Source: RightsNet:
www.rightsnet.org.uk |
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26 October
2006 |
£5 billion unclaimed
While there is much talk of tax credits overpayments, it is worth noting
that, according to HMRC figures published earlier this year, £5 billion
of tax credits goes unclaimed annually UK wide.
Source: RightsNet:
www.rightsnet.org.uk |
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24 October
2006
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Public Accounts Committee criticises
HMRC on fraud and error
The level of fraud and error in the tax credit
system is a 'matter of shame', the chair of the Commons Public Accounts
Committee has said. In evidence to the Committee, Paul Gray, acting chairman of
HMRC, said his department had been hampered in its efforts to combat errors by
lack of information. He told the committee of MPs that figures at his disposal
relate to 2003/2004, the first year of tax credit operations, and that HMRC will
not publish figures for the second year of operation until next spring.
Whilst Mr Gray said he regretted those cases where
families were caused hardship, Edward Leigh, the Committee's chairman, said
HMRC's administration of the tax credits system is a disgrace.The Committee was
also told that the cost of reforms to the tax credit system is likely to reach
£300m by 2010, although the reforms are expected to increase claimants'
entitlement by £500m this year.
Source: RightsNet:
www.rightsnet.org.uk |
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12 October
2006
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Reporting changes of
circumstances
New regulations have been issued in
relation to the reporting of changes of circumstances for tax credit
purposes.
From 1 November 2006, the Tax Credits
(Claims and Notifications) (Amendment) Regulations 2006
(SI.No.2689/2006) impose a requirement on a person claiming to notify
additional changes of circumstances where:
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there are changes in the number of hours
s/he (or partner) usually works and this takes her/him (or partner)
below the sixteen hours a week or 30 hours a week thresholds;
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s/he or partner ceases to be responsible
for a child or young person, for example where a child or young person
is taken into care or fostered with another family; and
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a child or young person ceases to qualify
for support, for example a young person leaves non-advanced full time
education or approved training before reaching 20, except where this
change is automatically applied. |
Also from 1 November 2006, the regulations
allow for the three month period for giving notice to begin from the
date when the person claiming first becomes aware of the change in
circumstances rather than from the date on which the change of
circumstances occur. Provision is also made for advance
notification to be able to be given where a child is expected to become
a qualifying young person, for example s/he intends to stay on in
non-advanced full-time education or training.
From 6 April 2007, the new regulations
reduce the time a person is given to notify required changes of
circumstances from three months to one month.
Source: RightsNet:
www.rightsnet.org.uk |
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18 September
2006 |
Overpayments and the
'reasonableness test'
Requests that HMRC not recover tax credit
overpayments may have fared very differently depending on when the
request was made, according to reports by the Low Incomes Tax Reform
Group (LITRG).
While before May 2005 and since February 2006 HMRC has used a
'reasonableness test' to decide whether to recover official error tax
credit overpayments, between these dates disputes were considered under
a 'streamlined' process, introduced to help HMRC clear a backlog of
disputed overpayments.
However, the 'streamlined' process proved
more easy to satisfy than the 'reasonableness test' - the decision
whether or not to recover an overpayment being based on how many award
notices the claimant had received, and how great the overpayment was -
and led to the Treasury Sub-Committee, in its June 2006 report on the
administration of the tax credits system, expressing its concern that
claimants appeared to have been treated differently, depending on
whether their disputed overpayment was considered.
LITRG has called on government to ensure
that people whose disputed overpayments were not written off prior to
the introduction of the streamlined procedure are given the opportunity
to have their disputed overpayments reconsidered under the criteria
applied in the streamlined procedure. LITRG is now calling for an
independent review of cases considered under the 'reasonableness test'.
SI.No.2689/2006 is available
here
or at
www.opsi.gov.uk/si/si2006/20062689.htm
Source: RightsNet:
www.rightsnet.org.uk |
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17 September
2006 |
Tax credit articles in
Frontline magazine
The new issue of Frontline magazine (number 61) has an article on
tax credit overpayments which can be found
here.
Issue 60 has an
article which examines
developments in the campaign to improve the administration of tax
credits. It
can be found
here.
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1 August
2006
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Multilingual tax credit information
adviceni
has produced a set of posters in Arabic, Urdu, Bengali, Portuguese, Cantonese
and Hindi and a multilingual booklet to help ensure members of Black and
Minority Ethnic communities in Northern Ireland have full access to information
and services provided by HMRC.
The posters promote the take up of tax credits. The booklet
gives basic information on tax credits together with details of where people can
receive further information.
The posters and
booklet can be downloaded from
www.adviceni.net.
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© Law Centre (NI) Novemver 2006
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