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UK Tax Credits

Tax Credits Time Bomb Threatens To Explode. 27 July 2008

The Tax Credit fiasco finally made the front pages today in a couple of excellent articles by Sunday Times journalist Jon Ungoed-Thomas.

Read Bullying tax officials lose £2.8 billion and Tax Credits Time Bomb Threatens To Explode at the Times online.

There is also the editorial comment A £2.8 billion farce over tax credits.

The biggest cover-up of the decade is finally exposed for all to see.

Now, let's have the amnesty that we have been campaigning for - followed by the writing-off of all non-fraudulent overpayments !!!

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Another Winner! 25 July 2008

Last month, we told the story of forum member 'Willow' in Family Told Their Children Don't Exist . Now 'Willow' has got in touch with us again, but with good news this time!

Tax Blunder is Solved – Thanks to The Reading Chronicle
reported by Alison Powell (on 10 July 2008)

A pregnant mum who was ordered to pay £12,000 and was told her children did not exist is celebrating after the Tax Credits Office admitted it blundered.

Celebrating her first proper night’s sleep for three months the 41-year-old said, “I cannot thank the Chronicle enough.”

We stepped in three weeks ago when the woman, who wants to retain her family’s privacy, turned to us in desperation. She said, “I am so relieved that it has been sorted and the worry can now end. I couldn’t have achieved this without the help of the Reading Chronicle and my MP Rob Wilson. I would urge anyone in my position to do the same thing.”

The problems began earlier this year when she told the tax office that her partner’s 13-year-old daughter was moving into their home permanently with them and their four-year-old daughter. Within a few days their tax credits were abruptly stopped and they were sent a £12,549 bill for “overpayments”.

The couple, who both work and are expecting a baby boy in three months, were devastated to be told that their children did not exist and that they had to pay back every penny they had received since 2004.

The mum said, “I was out of my mind with worry, couldn’t talk about it without crying and it was affecting my sleep and general well-being. The Tax Credits Office compiled a report and admitted to having made a mistake when I called them with information about the change in our family circumstances. I have received a back-payment for the tax credits they stopped whilst this was going on and they have offered £70 as compensation for the distress and financial implications of having written so many letters and making phone calls. The last three months have been very difficult. The mortgage has gone up, the cost of living has gone up and suddenly we had a drop in the amount of money coming in and the worry of this huge bill."
“I found the support of the Tax Credits Casualties website invaluable.”

MP Rob Wilson contacted Richard Summersgill, the Director of Tax and Credit Operations at HMRC, on the family’s behalf. He said, “I knew from the very start that it was an error by the Tax Credit Office, it’s just a shame that there are so many other people in this same situation with the same problems.”

Well done to 'Willow', who obviously knows better than HMRC whether her children exist or not!

Here at TCC, we have always recommended that overpayment victims get the press involved and contact their MP. 'Willow' managed to do both, still remain anonymous ...... and won !

If one person can do it, so can you !!

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The 2008 Finance Bill 18 July 2008

Here at TCC, we already know about the way that HMRC abuse their powers, but unfortunately for everyone, they are about to get even more. The 2008 Finance Bill is about to receive Royal Assent and then HMRC’s new powers kick in. What's this got to do with Tax Credits? Well, these fundamental reforms affect not only all taxpayers, but benefit claimants too ....

Nichola Ross Martin has written an excellent article, 'Taxpayers Deserve Proper Rights!', that looks at the problem, and what we can do about it. Everyone should read this - then write to your MP, as Nicola suggests. If you don't, then you can't complain when the HMRC bullies come knocking on your door .....

Many thanks to Ken Frost, at HMRC is Shi*e, for the information.

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HMRC Accounts 2007-2008 15 July 2008

National Audit Office head Tim Burr has refused to sign off the HMRC accounts for the sixth year in a row, stating that he could only issue a "qualified opinion" on the Tax Credit accounts because of the failure to stem losses.

In their online article 'Tax Credit Errors - But Whose?', the Low Income Tax Reform Group (LITRG) state:

"The NAO report is unable to separate claimant error from claimant fraud. There is a fundamental difference between the two and the reasons why each occurs should lead to different remedies. The report is also short on analysis as to why the claimant error component gives rise to what are undoubtedly extraordinarily high sums of money.
One figure which appears to be on the low side is the estimated figure for HMRC error at £80 million. We see a high proportion of tax credit overpayments where HMRC initially assert that they are correct, but which are eventually written off due to official error.
We are not confident that HMRC processes for distinguishing between claimant and HMRC error are sufficiently robust."

Very well and diplomatically put!

TCC would go a little bit further .... HMRC are fully aware of the scale of their official error and are involved in one of the biggest cover-ups of the decade. That is shameful enough, but the real scandal is that the Treasury and the Government must be aware of the truth - why else would they condone this behaviour with the recent bonus payments of £19M to staff at HMRC? When the organisation that 'cons' you is your own Government, there is something seriously wrong!

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'Let's Write Them Off ...' 13 July 2008

In his regular Sunday Mirror column, Jon Cruddas, Labour MP for Dagenham and former Labour Party deputy leadership contender, has called for all Tax Credit overpayments to be written off. The article, 'Go Easy On Tax Victims', states "It's time to wipe the slate clean on these so-called debts. Let's write them off - and make sure that the [Tax Credit] system really does do us credit."

Tax Credit Casualties were also featured in the Sunday Mirror article 'Amnesty Call In Tax Credit Chaos'.

(Note: The links to these Sunday Mirror articles have been removed, because the articles no longer exist on the Sunday Mirror website)

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Discussion Document 4 July 2008

The Treasury and HMRC have recently published a discussion document, "Tax Credits: Improving Delivery and Choice".

TCC will be responding to this discussion document, but we want to represent your views. If you would like to comment, please reference the paragraph numbers in the document and e-mail your input to Sarah@TaxCC.org by 3^rd August.

Thank you.

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Westminster Update 2 July 2008

Following their pledges of support at the launch of Voices of the Victims, Members of Parliament are raising questions in the Commons on our behalf and keeping Tax Credit overpayment and its impact on the agenda. Many thanks to Mark Hoban MP, Dave Anderson MP, Penny Mordaunt and Councillor Alistair Thompson.

Thank you also to John Hemming MP and Darren Sanders, who helped us raise our 'voices' at Number 10 last week by delivering our Petition and 'Voices of the Victims' to the Prime Minister on our behalf. We were originally refused permission to do so.

TCC are following up lines of funding after the legal consultations we have been involved in. For several reasons, we are not in a position to reveal any more of the issues discussed at the moment, only to say that we are very encouraged.

Coverage of the event and the booklet has spread far and wide; in the last month we know that 'Voices of the Victims' has been downloaded 118 times, and that's without all the PDF's and hardcopies we sent to MPs.

With new members making contact from Scotland .... to the Isle of Man .... to the Isle of Wight, the mental health impact of overpayment continues to raise its head. An unforgivably high percentage of new contacts are expressing complete distress and suicidal thoughts ..... and our 'listening' Prime Minister still doesn't seem to understand what we're so upset about!

One day!

Anyway .... below are a few more photos from our day in Westminster.

Tax Credit Casualties (TCC) is a voluntary, unfunded, not for profit organisation run by members for members. We cannot take any responsibility for decisions made by HMRC, The Parliamentary Ombudsman, The Adjudicator, or any other organisation, regarding claimants cases. We offer free advice on how to dispute unfair overpayments based on our own experiences, the experiences of other claimants and HMRC guidelines.
Please note that we are not tax professionals and are working on a voluntary basis, unpaid, in our ‘free time’. Between us, we have a lot of experience and knowledge in this area, gained over the last few years of supporting victims and helping them fight for justice and their rights. Legislation, operating practices and individual cases change all the time, and while we aim to be professional and accurate at all times, please understand the circumstances we are working under and accept our support, guidance and information in the sprit it is offered; goodwill and camaraderie.

Our Standards
TCC was established to provide advice and guidance on disputing recovery of non-fraud tax credit overpayments and to lobby for fundamental change on the inbuilt flaws and inequalities of the tax credit system. Whilst TCC provide guidance and information on how to handle disputes and even provide an advocacy service in some instances, neither TCC as an organisation not any participating members are responsible or liable for outcomes of disputes which remain wholly the remit of HMRC, the Adjudicator and/or the Parliamentary Ombudsman, as appropriate and dependent on the stage of dispute. TCC operate in a professional manner and endeavour to give accurate and appropriate advice based on information provided by members. TCC endeavour to respond to members as quickly and efficiently as possible, given the voluntary nature of the organisation and limited resources available. TCC is an inclusive organisation and will treat all members in a fair and equitable manner.

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