April 2008 News Archive
Tax Credit Mayhem 30 April 2008 
John Hemming, MP for Birmingham Yardley, yesterday published an article,
Unanswered Questions of Tax Evasion . The article is about overpayments caused by the annulment of Tax Credit awards, and the title refers to the Government evasion in answering questions about the subject. The cover up ..... By kind permission of Mr. Hemming, the article is reproduced in full below: Attention to detail is something that UK politics tends not to be that good at. However, as always, the devil is in the details.
Tax Credits have a number of benefits compared to the previous Family Credit system in that they allow an immediate response to changed circumstances. However, Family Credit was constant for 6 months and the certainty also has merit.
There is a finely balanced argument as to which is the better result. The problem with Tax Credits is that the delays in responding to changed circumstances cause situations in which people are overpaid and then need to repay the tax credits.
People make the assumption that they are due the money that they are paid and many families are unable to cope easily with a situation in which they are suddenly required to pay back money they thought was rightly theirs.
There is one aspect of Tax Credit overpayments that has not had the attention that it deserves. Within the Statutes there is a term that basically is intended to ensure that at a certain point the Tax Credit account is closed and cannot be revisited. This means that an annual return figure is agreed and basically cannot be changed later.
The problem with this is that HMRC have established guidelines that decree that anyone that fails to return their annual return on time has to pay all the tax credits back. Even a days delay means they have to pay it all back.
Again it is worth taking a few moments to work out what is happening. Alistair and Gordon are giving a family some money. The family is supposed to send a note saying that they agree the sum paid. If the note gets lost in the post they are asked to pay all the money back.
This is surreal. There are no other circumstances I am aware of where the failure to get a return in on time results in all monies being paid back. If we don’t get our tax returns on on time we don’t suddenly get all the tax back what we get instead is a £100 fine.
The damage this does to household finances is immense. I solved this issue for one of my constituents through using the threat of judicial review. However, it remains a problem for a lot more people.
I thought it would be useful to find out how many people it affects. So I asked “how many payments of child tax credit have involved overpayment because of a failure by HMRC to record the return of an annual declaration.”, but got the answer “There should be no overpayments arising because of a failure by HMRC to record the return of an annual declaration.” Typical evasion.
So I asked again “how much tax credit has been overpaid as a result of the claimant not providing an annual return to HMRC … and how many people were overpaid.” And got the answer “The information requested is available only at a disproportionate cost.” Refusing to answer.
We tried Freedom of information and got “the information is not held at this level”. This is a typical cover up. The government are doing something embarrassing that they want to hide so they refuse to reveal how many people are affected.
This is a good example of how the culture of evasion and refusing to answer questions causes bad government. Clearly this needs to change.
Truth, indeed .... ! In "The Data Protection Act and HMRC (Why You Should Worry)", below, I said how MPs are sick and tired. Our MPs are not only having to spend more and more time dealing with Tax Credit problems for constituents - but are then met by Government with evasion, cover up and refusals, often disguised as excuses, in answer to direct questions. Have a good read of yesterdays Westminster Hall Tax Credits debate . Daniel Kawczynski, (MP for Shrewsbury & Atcham), is basically saying that something is very wrong with the Tax Credit system. Jane Kennedy (Financial Secretary, HM Treasury), gives the kind of answers that we have come to expect from the Government, the Treasury and HMRC - but isn't it strange that she can produce the figures when she wants to. When it fits. When it suits .... [Top]
The Data Protection Act and HMRC ( Why You Should Worry!) 22 April 2008 One of the first things we recommend for new visitors to this site is that they claim their data from HMRC, by submitting a Subject Access Request (Data Protection Act). We recommend that overpayment victims do this because, in the vast majority of cases it is the only way to discover the truth about how an overpayment has occurred - the Tax Credit Office at HMRC cannot be relied upon to find, or tell, the truth, even when they know that an overpayment has been caused because of the Tax Credit system itself. Now, I'm not under any misconception that the loyal, disenchanted employees at HMRC do this out of any kind of malice. Oh, no! And by employees, I mean everyone who isn't at a senior managerial level. Maybe we should give the senior managers the benefit of the doubt, too. And let's include the Directors - they must have jobs to keep and families to feed. No, we must be fair ..... the Treasury, specifically, tell HMRC what to do. Does the buck stop there? Unfortunately, not. No, the buck stops with that person who has the initials GB - and, believe me, they don't stand for Great Britain! In our case, they stand for Gimmieit Back ..... Did you ever read the Hans Christian Andersen classic, The Emperor's New Suit? Why do I ask? Well, it seems to me that GB is still wearing his not-so-new Tax Credit suit, and anyone with any real influence over the 'cut of the suit' is still saying how good it looks! No matter that only a third of claims are actually correct, with one-third being underpaid and one-third being overpaid. No matter that MPs are sick and tired of having to deal with HMRC because of overpayments - and they get preferential treatment, so hopefully can imagine how the rest of us feel when we receive no response at all to letters or complaints, or worse still blatant untruths. Even GB's clan of Labour MPs are sick and tired of it all. In fairness, there are a few good Labour MPs who represent their constituents with honour, but the majority still have to publicly state that GB is wearing his fantastic, not-so-new Tax Credit suit. Can you imagine being an MP and having no say in regard to Tax Credits? You see a system that failed from day one, and is still failing five years after its inception, and you aren't listened to - only paid lip service, like the rest of the population! What hope for democracy, in this land that defined it? Remember, right at the beginning when I said that claiming your data was the only way to really discover how an overpayment had occurred? What I didn't say then was that, far too often, the telephone call or data that would be incriminating to HMRC was missing. Some people manage to get it after several requests - and some never, ever, receive the proof that they know exists. Now, we have always assumed that HMRC 'lose' things, and that was why the telephone call or data wasn't supplied - but maybe we have been too understanding of an organisation that really should get its act in gear. In the past, most claimants have eventually received quite a few hundred sheets of data following their Subject Access Request (SAR) - even if the vital bit of evidence just 'happened' to be missing. Recently, however, HMRC have been sending vastly reduced amounts of data following a SAR request. Why? They're playing a new game; it's called 'Legislation'. It is no longer possible for you to have confidence that the Data Protection Act will help you. Tax Credits, which are, in effect, a benefit, are administered using tax legislation. The Tax Credit Act 2002 states in section 29, subsection (3): Where a notice states that this subsection applies in relation to an amount (or part of an amount), it is to be treated for the purposes of Part 6 of the Taxes Management Act 1970 (c. 9) (collection and recovery) as if it were tax charged in an assessment and due and payable by the person or persons to whom the notice was given at the end of the period of thirty days beginning with the day on which the notice is given.
In its information factsheet, DP F/S1, under the subheading "Is All Information Always Released?", HMRC state: The law also allows us to withhold information, for example, where release would be likely to prejudice- the prevention or detection of crime
- the apprehension (arrest) or prosecution of offenders
- the assessment or collection of any tax or duty
- information that may reveal the identity of another person, or information about them.
What this really says is that any data that prevents them from collecting what they currently deem to be tax owed, they do not have to supply - and the Tax Credit Act (2002) section 29 (3) clarifies that this includes overpaid Tax Credit data. It seems that the game of 'Legislation' is now well and truly in play! I also hope you note that, once again, overpayment victims are somewhere below criminals in HMRC's list, and it seems that, where we have given HMRC the benefit of the doubt regarding vital missing data in the past, we were mistaken. All those cases of missing data! And we just thought that they were incompetent and guilty of maladministration! How can it be fair and justifiable to withhold data that may prove or disprove their argument about the very things we are disputing - who was responsible for the overpayment? In the majority of cases, I'll give you one guess .... it's the fault of the Tax Credit system, and HMRC don't care about 'fair and justifiable'. It seems that HMRC's job has nothing to do with truth, honour or the higher principles of service. It is simply about getting the cash, and covering up the chaos of a system that was doomed to failure, because of its known design flaws, right from the start. It is well past time that those in a position of influence and authority took the moral high ground. Time that those who serve the many stood up and were heard. Yes, isn't GB's not-so-new Tax Credit suit just absolutely perfect!! [Top]
Donations to Tax Credit Casualties 20 April 2008 TCC are pleased to announce that we can now accept donations using most major bank cards, through PayPal's secure banking services. Donations can also be made using your PayPal account, if you have one. If you can, no matter how small, please consider making a donation [Top]
Here's YOUR Chance To Be Heard 17 April 2008 Although the date is yet to be finalised, Tax Credit Casualties are returning to Westminster to campaign on behalf of all overpayment victims. Very soon. We will be meeting with MPs, politicians and members of the media to tell them exactly what we think of this system and why. Many politicians are in denial about there being any significant problems with the current Tax Credit system, and we want to prove otherwise, by letting real people tell their own stories in their own words. TCC are putting together a booklet of HMRC horror stories. Your HMRC horror stories! This will be presented to all attending on the day - and it won't cost them anything, except, maybe, a torn conscience. All we need from you is your story, including your own comments on how you feel about your treatment by HMRC, along with your name and where you are from, e.g. Fred(a) Wilkinson, Kent. A paragraph or a page? It's up to you, but if you can keep the language down it would save us a lot of editing time! I know - I feel the same .... but the booklet will be going to people who have the power to push for this vile and oppressive system to be changed for the better! This is an unprecedented opportunity .... Please send your story to Horror@TaxCC.org as soon as you can. Thank you! P.S. As with everything TCC do, the costs of this are coming out of our own pockets. If you can, no matter how small, please consider making a donation . [Top]
We Need Your Help ! 16 April 2008 Everyone will be able to help us with this one! We would like you to send us the e-mail addresses of all the political people in your area. There - really easy! This isn't a political site, but Tax Credit Casualties were refused charity status because we were deemed to be too "political". We couldn't make them understand that it wasn't political parties that we had a go at - just the idiots that make the bad decisions within them!! And, when it comes to Tax Credits and idiots, we all know that Gordon is the prime moron, don't we? The head idiot being kowtowed-to by lesser idiots - hard to work out who is the more stupid, isn't it? However, there are many good MPs out there - even if it is a little bit very difficult to find one of Gordon's clan that doesn't follow the party line publically. Not just MPs either - up and coming political dynamos of all varieties can help in our campaign. Anyway, we would like you to e-mail us their e-mail addresses, please - so that we can add to our already big mailing list. Why? Well, MPs don't tend to publish their e-mail addresses - except locally. Local papers, election leaflets, posters .... you know the type of thing. Please send us their name, e-mail address, what they are (i.e. Tory MP for exville, or Liberal candidate for suchnsuch, or outgoing Labour MP for thepits) to info@TaxCC.org . It doesn't matter how many duplicates we get, we can easily sort that. Why not ask your friends to as well - and lets start an avalanche of e-mails across the country. You won't clog up our mailbox .... honestly! [Top]
TAX CREDIT FIASCO GOES ON HAUNTING POOREST FAMILIES 13 April 2008 On Wednesday 9th April, Harvey Jones wrote, in the Daily Express, "Cash-Strapped families all over Britain are continuing to face severe hardship due to the ongoing tax credits fiasco" ....... Read the full story at the Express website. Why not register, and "Have Your Say" ? Also, see TCC's thoughts on the New COP26. [Top]
A Happy Ending? Well, sort of ..... 11 April 2008 Trying to get the local Tax Office to help you? Finding it impossible? Yesterday, we received an e-mail from "K", telling us exactly how to get the help you need when you're at your wits end .... Read not so much overpayment, as total lack of payment , and learn how to do it. [Top]
Britain: Tax Credit System Plunges Families Into Debt 10 April 2008 One of the speakers at TCC's meeting in Rotherham on 8th March, Jean Shaoul (S.E.P), certainly has a comprehensive understanding of how the Tax Credit system came about. Jean has recently published an excellent article on the World Socialist Web Site, which not only tells the background story of Tax Credits, but reveals the more ominous intentions of deliberate Government policy. I would urge everyone to not only read this article, but to publicise it as much as possible; bulletin boards, e-mail, snail mail ...... and don't forget to send it to your MP. Read Britain: Tax Credit System Plunges Families Into Debt by Jean Shaoul [Top]
Tax Hell Blog 8 April 2008 Although not directly about Tax Credits, the Tax Hell Blog by freelance journalist Nick Morgan clearly shows that we are all dealing with the same "customer focused" (dis-)organisation that is HMRC. The same "guilty until you prove yourself innocent", at your expense, attitude. The same bullying. The same lies. The same abuse of power. Read it and weep. Then get angry. Then get writing .... We pay the Government's wages (and their inflated expenses, it seems). We pay HMRC's wages. Seems like a lot of people need reminding who the boss is! [Top]
More Tax To Pay If You're Poor 4 April 2008 The Low Income Tax Reform Group have just published a new article on their website. From 6th April, the 10% income tax rate will no longer exist. If you're poor, you'll pay more tax - but if you're better off you'll pay less ..... What a fantastic anti-poverty measure! I wonder which complete idiot thought this one up? Can you guess? Read the report, More Tax To Pay If You're Poor, on the LITRG website. [Top]
Cancelling Your Tax Credit Claim For 2008/09 3 April 2008 We have had a few enquiries from very frustrated people who want to cancel their Tax Credit claim for the coming tax year, but are having severe difficulties getting the message across to HMRC. It seems that HMRC just can't understand that some people simply don't want even more debt piled on their shoulders. People are so fed up with HMRC's bullying, mistakes, incompetence, evasion of the truth and systematic maladministration of Tax Credits, that they want no more of this "Russian Roulette" benefit. Many, many claimants are locked into in the Tax Credit debt trap - and are unable to cancel their 'award' because they would be presented with immediate demands to pay thousands of pounds back to the official Government 'mugging' department - followed shortly after by a summons. These people would then find that they had less legal rights than a murderer, rapist or other criminal - all because they rightly claimed "Money With Your Name On It". As for Human Rights; well, they seem to end at the Tax Credit door as well. If you've been fortunate enough to escape the Tax Credit debt trap, and want to cancel your eternally ongoing award, here's a sample Tax Credit cancellation letter for you to download, edit and send. Gordon Brown seems to think that abolishing the 10p starting rate of income tax won't affect the low paid, because those on low pay can apply for Tax Credits to compensate for the extra cost. Do you really, really think so? There are probably lots of people reading this who wished you were in their form at school, Mr. Brown - then they wouldn't have come bottom of the class. Guaranteed !! People need the money that Tax Credits provide. Overpayment because of the problems inherent to the Tax Credit system not only causes that financial support to be withdrawn, it also plunges families deep into poverty, for years, while they are forced to repay something that wasn't their fault in the first place. That's why people are willing to cancel their Tax Credit awards and suffer poverty! For the people who like figures, The New Policy Institute website, The Poverty Site, is the UK site for statistics on poverty and social exclusion. The link takes you straight to the Tax Credits section. [Top] | 
