tax credits
working tax credits
tax credit scandal
HMRC
Her Majesty's Revenue and Customs
Revenue and Customs
Turbo Tagger
Piles of Money
Biggest Tax Credits Pay out Ever, and on Time!!!
Thursday 22 November 2007
Thursday 8 November 2007
If tax credits are your salvation, what about the families they've damned?
If tax credits are your salvation, what about the families they've damned?
...
As many charities will testify, the scheme is not only complicated but has been plagued by administrative errors and computer glitches. Together, these elements have inflicted distress and frustration on thousands of families as incorrect sums of money have been both paid into - and then pulled out of - their accounts.
The struggles with tax credits are well documented and Gordon Brown's Budget last month only added fuel to the fire. His abolition of the "starter rate" 10 per cent tax band was criticised for hitting the less-well-off, who will, from next year, have to pay tax at the new basic rate of 20p on any income over their personal allowance.
The Treasury defended this move by announcing extra cash via both child tax credits (CTCs) and working tax credits (WTCs). But many question whether the revalued benefits will offset the tax changes.
...
It is now seemingly a necessity for those with incomes between £5,255 and £18,605 to get to grips with the tax credit system and claim in order to negate their losses through other tax measures," says Francesca Lagerberg of accoun- tants Grant Thornton.
...
In the 2005-06 financial year, Citizens Advice dealt with more than 150,000 problems relating to WTC and CTC. Its figures suggest one in three claimants have been overpaid - leaving many in dire straits as Revenue & Customs tries to claw back the money.
"Families are finding themselves struggling to repay large amounts without receiving proper explanations of how the liability has arisen - and without being given notice before [the debt] recovery starts," says Ms Lane. "Thou- sands of families are also being threatened with court action for the recovery of overpayments - sometimes without even knowing the amount due."
...
As many charities will testify, the scheme is not only complicated but has been plagued by administrative errors and computer glitches. Together, these elements have inflicted distress and frustration on thousands of families as incorrect sums of money have been both paid into - and then pulled out of - their accounts.
The struggles with tax credits are well documented and Gordon Brown's Budget last month only added fuel to the fire. His abolition of the "starter rate" 10 per cent tax band was criticised for hitting the less-well-off, who will, from next year, have to pay tax at the new basic rate of 20p on any income over their personal allowance.
The Treasury defended this move by announcing extra cash via both child tax credits (CTCs) and working tax credits (WTCs). But many question whether the revalued benefits will offset the tax changes.
...
It is now seemingly a necessity for those with incomes between £5,255 and £18,605 to get to grips with the tax credit system and claim in order to negate their losses through other tax measures," says Francesca Lagerberg of accoun- tants Grant Thornton.
...
In the 2005-06 financial year, Citizens Advice dealt with more than 150,000 problems relating to WTC and CTC. Its figures suggest one in three claimants have been overpaid - leaving many in dire straits as Revenue & Customs tries to claw back the money.
"Families are finding themselves struggling to repay large amounts without receiving proper explanations of how the liability has arisen - and without being given notice before [the debt] recovery starts," says Ms Lane. "Thou- sands of families are also being threatened with court action for the recovery of overpayments - sometimes without even knowing the amount due."
Overhaul tax credits or miss key child poverty targets, Brown told.
Overhaul tax credits or miss key child poverty targets, Brown told.
· Citizens Advice calls for a 'radical rethink' of system· Almost half of tax credit payments were incorrect
....
In 2004-05, almost half of all payments were incorrect. Of the nearly 6.5 million families receiving them, almost 2 million were overpaid and then forced to pay the money back, while more than 900,000 were underpaid.
· Citizens Advice calls for a 'radical rethink' of system· Almost half of tax credit payments were incorrect
....
In 2004-05, almost half of all payments were incorrect. Of the nearly 6.5 million families receiving them, almost 2 million were overpaid and then forced to pay the money back, while more than 900,000 were underpaid.
'Harsh' and 'unfair': efforts to claw back tax credit overpayments are berated.
'Harsh' and 'unfair': efforts to claw back tax credit overpayments are berated.
Gordon Brown's flagship tax credit system is under attack again, this time from the Parliamentary Ombudsman, Ann Abraham.
In her second report into the system, published on the same day as the pre-Budget report, Ms Abraham concluded that 365,000 families a year were being forced into debt in order to hand back credits that had been overpaid originally.
She branded as "harsh" HM Revenue & Customs' attempts at recovering overpayments and said they were causing "worry and anxiety to many low-income families".
...
Some 91 per cent of all complaints received by her office, she added, resulted from an "unfair and inconsistent" application of the rules on reclaiming cash.
...
Meanwhile, the charity Citizens Advice said the problems were eroding public trust in the £16bn,(£16,000,000,000.00), tax credit scheme. A survey of visitors to its bureaux found that more than half would be less likely to claim credits in future as a result of their experiences.
Gordon Brown's flagship tax credit system is under attack again, this time from the Parliamentary Ombudsman, Ann Abraham.
In her second report into the system, published on the same day as the pre-Budget report, Ms Abraham concluded that 365,000 families a year were being forced into debt in order to hand back credits that had been overpaid originally.
She branded as "harsh" HM Revenue & Customs' attempts at recovering overpayments and said they were causing "worry and anxiety to many low-income families".
...
Some 91 per cent of all complaints received by her office, she added, resulted from an "unfair and inconsistent" application of the rules on reclaiming cash.
...
Meanwhile, the charity Citizens Advice said the problems were eroding public trust in the £16bn,(£16,000,000,000.00), tax credit scheme. A survey of visitors to its bureaux found that more than half would be less likely to claim credits in future as a result of their experiences.
The intention was great but the execution is a scandal
The intention was great but the execution is a scandal.
...
The two reports – one from charity Citizens Advice and the other from Parliamentary Ombudsman Ann Abraham – paint a picture of a tax credit system that is still driving thousands of families into debt and despair. And just as depressing is that both the charity and Ms Abraham have said all this before.
...
In this case, a claimant actually called HMRC to check the accuracy of a credit award and was assured that all was fine. But later the individual was told a mistake had been made and the cash had to be repaid.
A bright spark at HMRC argued that the claimant's decision to check the award meant they could not reasonably believe it was theirs. A catch-22 worthy of the pen of Joseph Heller.
Sadly, such tactics aren't out of the ordinary as some HMRC staff look to shift the blame for mistakes on to claimants.
...
The two reports – one from charity Citizens Advice and the other from Parliamentary Ombudsman Ann Abraham – paint a picture of a tax credit system that is still driving thousands of families into debt and despair. And just as depressing is that both the charity and Ms Abraham have said all this before.
...
In this case, a claimant actually called HMRC to check the accuracy of a credit award and was assured that all was fine. But later the individual was told a mistake had been made and the cash had to be repaid.
A bright spark at HMRC argued that the claimant's decision to check the award meant they could not reasonably believe it was theirs. A catch-22 worthy of the pen of Joseph Heller.
Sadly, such tactics aren't out of the ordinary as some HMRC staff look to shift the blame for mistakes on to claimants.
Tax credit system to become such a shambles.
Scandal of tax credits system must be addressed
From the Oxford Mail, first published Thursday 1st Jun 2006.
It is scandalous that the Government has allowed the tax credit system to become such a shambles.
It was launched with good intentions - to raise the income of the lower-paid and help them enjoy a decent standard of living.
But the scheme has been dogged by administrative blunders. Latest figures show that 16,000 Oxfordshire families were overpaid by £13.1m, (£13,100,000.00), - an average of £825 each.
Meanwhile, 7,400 families in the county have been underpaid.
From the Oxford Mail, first published Thursday 1st Jun 2006.
It is scandalous that the Government has allowed the tax credit system to become such a shambles.
It was launched with good intentions - to raise the income of the lower-paid and help them enjoy a decent standard of living.
But the scheme has been dogged by administrative blunders. Latest figures show that 16,000 Oxfordshire families were overpaid by £13.1m, (£13,100,000.00), - an average of £825 each.
Meanwhile, 7,400 families in the county have been underpaid.
Government has allowed the tax credit system to become such a shambles.
It was launched with good intentions - to raise the income of the lower-paid and help them enjoy a decent standard of living.
But the scheme has been dogged by administrative blunders. Latest figures show that 16,000 Oxfordshire families were overpaid by £13.1m, (£13,100,000.00), - an average of £825 each.
Meanwhile, 7,400 families in the county have been underpaid.
...
The Government says that overpayments will be written off where its staff have made the mistake and the claimant could not have spotted the error.
But that still leaves thousands of families in suspense, worried that they might have to cut their spending to pay back the money.
HM Revenue and Customs [HMRC] says it will sue US-based services supplier EDS
HM Revenue and Customs [HMRC] says it will sue US-based services supplier EDS
Unless the supplier steps up compensation payments for failures in its IT support for tax credits, which led to tens of millions of pounds in incorrect payments to claimants.
The Revenue’s chairman Paul Gray says his officials have carefully archived “millions of relevant documents” in preparation for a court case he hopes will not happen.
......
EDS last year agreed to pay HMRC £71.25m, (£71,250,000.00) in compensation after serious problems with the tax credit computer system led directly to gross losses of £209m, (£209,000,000), for the department.
......
Editor notes:=
This seems very strange to me... The HMRC imply that they are no major problems with the Tax Credits Computer System and payments are correct accept where the clament has made an error.
Other Links:-
HMRC's settlement with EDS - House of Commons' Public Accounts Committee report
Tax Credits Fiasco costs EDS £71m - BBC online
Revenue gears up for court battle against EDS
How far is this tax fiasco down to IT?
EDS’s settlement with the government over tax credits
Compensation deal a sham says MP - Financial Times
EDS settles with HMRC for £71m - Accountancy Age
HM Revenue and Customs pays a strange compliment to its ASPIRE tax credits suppliers
HMRC attacked over EDS deal and lack of 'fair play' - Accountancy Age (2006)
MPs slam EDS compensation deal with taxman
Unless the supplier steps up compensation payments for failures in its IT support for tax credits, which led to tens of millions of pounds in incorrect payments to claimants.
The Revenue’s chairman Paul Gray says his officials have carefully archived “millions of relevant documents” in preparation for a court case he hopes will not happen.
......
EDS last year agreed to pay HMRC £71.25m, (£71,250,000.00) in compensation after serious problems with the tax credit computer system led directly to gross losses of £209m, (£209,000,000), for the department.
......
Editor notes:=
This seems very strange to me... The HMRC imply that they are no major problems with the Tax Credits Computer System and payments are correct accept where the clament has made an error.
Other Links:-
HMRC's settlement with EDS - House of Commons' Public Accounts Committee report
Tax Credits Fiasco costs EDS £71m - BBC online
Revenue gears up for court battle against EDS
How far is this tax fiasco down to IT?
EDS’s settlement with the government over tax credits
Compensation deal a sham says MP - Financial Times
EDS settles with HMRC for £71m - Accountancy Age
HM Revenue and Customs pays a strange compliment to its ASPIRE tax credits suppliers
HMRC attacked over EDS deal and lack of 'fair play' - Accountancy Age (2006)
MPs slam EDS compensation deal with taxman
Thursday 1 November 2007
Brown ‘cheats' working families
Brown ‘cheats' working families
WORKING families are being “brutally discriminated” against by the Government’s Tax Credit system, according to a damning new report.
Former Labour minister, Frank Field’s ?Reform’ thinktank has found that single parents have little incentive to form new relationships as they face losing hundreds of pounds of benefits.
WORKING families are being “brutally discriminated” against by the Government’s Tax Credit system, according to a damning new report.
Former Labour minister, Frank Field’s ?Reform’ thinktank has found that single parents have little incentive to form new relationships as they face losing hundreds of pounds of benefits.
Tax credit claw-back was illegal
Tax credit claw-back was illegal
HARD-UP workers forced to repay millions of pounds in bungled tax credits without warning are to get the cash back ? because the Government acted illegally.
Ministers failed to notify claimants in 250,000 cases over three years that they meant to claw back the cash.
...
A HM Revenue and Customs whistleblower claimed around £500million will have to be repaid, on top of a £200million bill to fix the fiasco.
HARD-UP workers forced to repay millions of pounds in bungled tax credits without warning are to get the cash back ? because the Government acted illegally.
Ministers failed to notify claimants in 250,000 cases over three years that they meant to claw back the cash.
...
A HM Revenue and Customs whistleblower claimed around £500million will have to be repaid, on top of a £200million bill to fix the fiasco.
OPFS joins call for Tax Credit overhaul
OPFS, One Parent Families Scotland.
Posted: 09.10.2007 Immediate Release
Following today's critical report into Tax Credits by the Parliamentary Ombudsman, One Parent Families Scotland have called for a major overhaul to the Tax Credit system.
"We need a simpler and fairer way of supporting families on low wages", comments Ian Maxwell, Associate Director of One Parent Families Scotland.
"We know from callers to our Lone Parent Help-line that Tax Credits are too complicated, that the paperwork is often difficult to understand, and the Tax Credit Helpline often fails to give correct answers to the more complicated questions."
"Tax Credits aren't 'fatally flawed', but unless the Government owns up to these problems and sorts them out quickly, lone parents who could use these extra payments to return to work will be deterred from even thinking about employment."
Note: Scotish Law may be different for United Kingdom Law.
Posted: 09.10.2007 Immediate Release
Following today's critical report into Tax Credits by the Parliamentary Ombudsman, One Parent Families Scotland have called for a major overhaul to the Tax Credit system.
"We need a simpler and fairer way of supporting families on low wages", comments Ian Maxwell, Associate Director of One Parent Families Scotland.
"We know from callers to our Lone Parent Help-line that Tax Credits are too complicated, that the paperwork is often difficult to understand, and the Tax Credit Helpline often fails to give correct answers to the more complicated questions."
"Tax Credits aren't 'fatally flawed', but unless the Government owns up to these problems and sorts them out quickly, lone parents who could use these extra payments to return to work will be deterred from even thinking about employment."
Note: Scotish Law may be different for United Kingdom Law.
Tax credit system "losing £1bn a year"
Tax credit system "losing £1bn a year"
£1,000,000.00
The tax credit system is making "unacceptably high" losses, according to a new report from the National Audit Office (NAO).
The study revealed that fraud and errors are costing taxpayers as much as £1bn a year.
In addition to this, £2.3bn of tax credits that were overpaid in 2003/04 were yet to be recovered by HM Revenue & Customs (HMRC) in April 2007.
Sir John Bourn of the NAO said, ’Once again, the levels of claimant error and fraud in the tax credit schemes are unacceptably high. It is important that the department now targets reductions in levels of error and fraud and considers how its compliance teams can engage more widely with tax credit claimants’.
Responding to the report, the Government said that instances of error and fraud have been falling since last year, when measures were taken to reduce the problem.
However, Shadow Chancellor George Osborne has urged Chancellor Alistair Darling to do more to tackle the issue.
£1,000,000.00
The tax credit system is making "unacceptably high" losses, according to a new report from the National Audit Office (NAO).
The study revealed that fraud and errors are costing taxpayers as much as £1bn a year.
In addition to this, £2.3bn of tax credits that were overpaid in 2003/04 were yet to be recovered by HM Revenue & Customs (HMRC) in April 2007.
Sir John Bourn of the NAO said, ’Once again, the levels of claimant error and fraud in the tax credit schemes are unacceptably high. It is important that the department now targets reductions in levels of error and fraud and considers how its compliance teams can engage more widely with tax credit claimants’.
Responding to the report, the Government said that instances of error and fraud have been falling since last year, when measures were taken to reduce the problem.
However, Shadow Chancellor George Osborne has urged Chancellor Alistair Darling to do more to tackle the issue.
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