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Tax credits: HMRC targets ‘incorrect single claims’

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HMRC is sending out a stark warning to tax credit claimants, reminding them that they are required to tell HMRC ‘immediately’ if a partner moves in or out of the household. Almost a quarter of a million letters are being sent to claimants this week, a spokeswoman told Tax Journal.

About 150,000 tax credits claims for 2008/09, 2.5% the total, were incorrect single claims. ‘Deliberately failing to let HMRC know could constitute criminal fraud and result in prosecution,’ HMRC said.

One of the most common reasons for tax credit overpayments is ‘down to claiming as a single person rather than as a couple’, HMRC guidance says. It adds that whether claimants who are neither married nor in a civil partnership should make a joint claim or a single claim depends on ‘factors such as where you both live, whether you've split up and if so for how long, [and] if you're in a new relationship’. See

HMRC announced yesterday that ‘as part of a wider Government crackdown on error and fraud in benefits and credits’, letters will start to land on doorsteps this week asking claimants to contact HMRC if their personal circumstances have changed.

HMRC added: ‘Failure to tell HMRC promptly of changes can result in overpayment, which means claimants will have to pay back the money they have received. They may also face a penalty and, in cases of deliberate fraud, imprisonment.’

David Gauke, the Exchequer Secretary to the Treasury, said: ‘There has been too much error and too much fraud for too long in our benefits and tax credits systems. It is unfair, unaffordable and unacceptable. Today we are shining a light on the problem across the system and setting out a radical, cross-Government solution. We simply have to make every penny count – and that includes going after the cheats at every level.’

Issue: 1050
Categories: News , Private client taxes