Tag: tax credits

HMRC: 2.1 million annual tax credits packs to be issued

About 2.1 million tax credits customers will begin to receive their annual renewal packs this week from HM Revenue and Customs (HMRC).

The packs will be sent between 25 April and 27 May, and customers have until 31 July to check their details are correct and update HMRC if there has been a change in their circumstances.

Tax credits help working families with targeted financial support, so it is important that people do not miss out on money they are entitled to.

There are two types of renewal packs:

·         if it has a red line across the first page and says ‘reply now’, customers will need to confirm their circumstances to renew their tax credits

·         if it has a black line across the first page and says ‘check now’, customers will need to check their details are correct. If correct, customers do not need to do anything and their tax credits will be automatically renewed

About 630,000 customers will need to confirm their circumstances to renew their tax credits for the 2022 to 2023 tax year.

Customers can renew their tax credits for free via GOV.UK or the HMRC app.

Renewing online is quick and easy. Customers can log into GOV.UK to check the progress of their renewal, be reassured it is being processed and know when they will hear back from HMRC. Customers choosing to use the HMRC app on their smartphone can:

  • renew their tax credits
  • update changes to their claim
  • check their tax credits payments schedule, and
  • find out how much they have earned for the year

HMRC has released a video to explain how tax credits customers can use the HMRC app to view, manage and update their details.

If there is a change in a customer’s circumstances that could affect their tax credits claims, they must report the changes to HMRC. Circumstances that could affect tax credits payments include changes to:

·         living arrangements

·         childcare

·         working hours, or

·         income (increase or decrease)

Tax credits are ending and will be replaced by Universal Credit by the end of 2024. Many customers who move from tax credits to Universal Credit could be financially better off and can use an independent benefits calculator to check. If customers choose to apply sooner, it is important to get independent advice beforehand as they will not be able to go back to tax credits or any other benefits that Universal Credit replaces.

One week left to renew for 300,000 tax credits customers

More than 300,000 tax credits customers have just over one week to renew their claims before the 31 July deadline, HM Revenue and Customs (HMRC) has warned.

As the deadline approaches, customers are being urged not to leave their renewal until the last minute and risk their payments being stopped. The quickest and easiest way to complete a renewal is via GOV.UK. Customers can manage their tax credits online.

Once tax credits customers have completed their renewal, they can use their online account to check its progress and find out when they will hear back from HMRC.

This year, about 28,000 customers have used the official HMRC app on their smartphone to renew their tax credits. The app allows customers to:

  • report any tax credits changes and complete their renewal
  • check their tax credits payments schedule, and
  • find out how much they have earned for the year.

Myrtle Lloyd, HMRC’s Director General for Customer Services, said: “Tax credits payments can provide our customers with vital financial support. There is just one week left to renew your claim – don’t delay and do it online by searching ‘tax credits’ on GOV.UK.”

Customers do not need to report any temporary falls in their working hours as a result of coronavirus. Unless their hours have permanently changed, they will continue to be treated as if they are working their normal hours for up to eight weeks after the Coronavirus Job Retention Scheme closes.

Any self-employed individuals who have claimed a Self-Employment Income Support Scheme grant will need to declare the grant payments. Search ‘working out your income for tax credit/self-employment’ on GOV.UK.

But if there is a change in a customer’s circumstances that could affect their tax credits, they must report the changes to HMRC. These include changes to:

·       living arrangements

·       childcare

·       working hours, or

·       income (increase or decrease).

Post Office card accounts are closing. From 30 November 2021, HMRC will stop making payments of Child Benefit, Guardians Allowance and tax credits, into Post Office card accounts. HMRC is reminding any tax credits and Child Benefit customers who use this account to receive their payments, that they will need to notify HMRC of their new bank account details.

HMRC is encouraging customers to act now so they do not miss any payments once their Post Office account closes. They can contact HMRC’s helpline (0345 300 3900), update their details while renewing tax credits or use their Personal Tax Account. To find out how to open a bank account, visit Citizens Advice.

HMRC is also urging customers to be careful if they are contacted out of the blue by someone asking for money or personal information. The department sees a high number of fraudsters calling, texting or emailing people claiming to be from HMRC. 

If in doubt, HMRC advises customers not to reply directly to anything suspicious, but to contact HMRC straight away and to search GOV.UK for ‘HMRC scams’.

Scams warning for tax credits customers

Tax credits customers should be vigilant and alert to potential scams, HM Revenue and Customs (HMRC) has warned, as the remaining annual renewal packs will arrive in the post this week.

In the 12 months to 30 April 2021, HMRC responded to more than 1,154,300 referrals of suspicious contact from the public. More than 576,960 of these offered bogus tax rebates.

In the same period, HMRC has worked with telecoms companies and Ofcom to remove more than 3,000 malicious telephone numbers and with internet service providers to take down over 15,700 malicious web pages. HMRC responded to 443,033 reports of phone scams in total, 135% up on the previous year.

Anyone doing their tax credits renewal who has received a tax or benefits scam email or text might be tricked into thinking it was from HMRC and share their personal details with the criminals or even transfer money for a bogus overpayment.

HMRC’s Cyber Security Operations identifies and closes down scams every day. The department has pioneered the use in government of technical controls to stop its helpline numbers being spoofed, so that fraudsters can no longer make it appear that they are calling from those HMRC numbers. 

Myrtle Lloyd, HMRC’s Director General for Customer Services, said: “We’re urging all of our customers to be really careful if they are contacted out of the blue by someone asking for money or bank details.

“There are a lot of scams out there where fraudsters are calling, texting or emailing customers claiming to be from HMRC. If you have any doubts, we suggest you don’t reply directly, and contact us yourself straight away. Search GOV.UK for our ‘scams checklist’ and to find out ‘how to report tax scams’.”

Many scams mimic government messages to appear authentic and reassuring. HMRC is a familiar brand, which criminals abuse to add credibility to their scams.  

If customers cannot verify the identity of a caller, HMRC recommends that you do not speak to them. Customers can check GOV.UK for HMRC’s scams checklist to find out how to report tax scams and for information on how to recognise genuine HMRC contact.

Tax credits help working families with targeted financial support, so it is important that people don’t miss out on money they are entitled to. Customers have until 31 July to notify HMRC of any change in circumstances that could affect their claims.

Renewing online is quick and easy. Customers can log into GOV.UK to check on the progress of their renewal, be reassured it is being processed and know when they will hear back from HMRC.

Customers can also use the HMRC app on their smartphone to:

  • renew their tax credits
  • check their tax credits payments schedule, and
  • find out how much they have earned for the year

Tax credits customers must report the changes to HMRC. Circumstances that could affect tax credits payments include changes to:

·         living arrangements

·         childcare

·         working hours, or

·         income (increase or decrease)

Customers do not need to report any temporary falls in their working hours as a result of coronavirus. They will be treated as if they are working their normal hours until the Coronavirus Job Retention Scheme closes.

Swinney urges Osborne: do the right thing

Chancellor must listen to growing opposition to austerity measures

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The Scottish Government has consistently demonstrated that the UK’s deficit and debt can be brought down without the need for huge public spending cuts as set out by the UK Government, Deputy First Minister and Finance Secretary John Swinney said today. Continue reading Swinney urges Osborne: do the right thing

Tax Credits: a battle won but the war goes on

Government fury over Lords revolt

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Chancellor George Osborne has said he will act on concerns about the impact of tax credit cuts after peers forced the Westminster government to think again last night – but he has vowed to press on with changes designed to slash billions from the country’s welfare bill.

In a dramatic night the House of Lords defeated the government in two votes over the controversial legislation, forcing the government climbdown.

The Chancellor has now agreed to offer ‘transitional help’ for those hundreds of thousands of people affected by cuts – but the government was angered by the defeats in the unelected ‘other place’ is now considering a review of Lords conventions to address what is sees as ‘constitutional issues’.

The proposed cut to tax credits is the most controversial piece of legislation introduced since the Conservative government’s election in May.

Tax credits were introduced by the last Labour government to help low-paid families. There are two types: Working Tax Credit for those in work, and Child Tax Credit for those with children.

Tax credits are gradually being included within Universal Credit, which is currently being rolled out across the country. Under the government’s plans, the income threshold for receiving Working Tax Credits and Child Tax Credit is due to be cut from April next year.

4.5 million people are currently eligible to claim tax credits.

Campaigners and respected think-tanks argue that the proposed tax credit cuts would deprive low-income workers of up to £1,300 a year but the Westminster government says the cuts are essential to tackle the UK’s massive deficit. It says most claimants will be better off when other changes, such as the introduction of the new national living wage, are taken into account.

Tax credits were worth around £2 billion to Scottish households in 2013/14, with two thirds of support directed at low income working families.

Scotland’s Social Justice Secretary Alex Neil called for for the UK Government proposals to be ditched in a letter to the Secretary of State for Work and Pensions earlier this week.

Me Neil said the UK Government should urgently rethink tax credit changes which will punish families and push even more children into poverty and urged the UK Government to rethink its plans to cut tax credits which mean households with the least money will face the biggest losses.

 

Mr Neil said: “Cutting tax credits is a thoughtless approach which may save the Treasury money in the short term but will have heart-breaking long-term consequences that could rebound on other public and charitable services.

“Tax credits can be a lifeline for families on low incomes that rely on them to get through daily life, put food on the table, heat their home and pay their bills.

“Removing this vital support from thousands of families will widen the gap in inequalities and push even more people into poverty.

“The UK Government’s plans are a clear attack on low income working families and those families must be protected as a matter of urgency.

“The Scottish Government has made clear its opposition to these changes and I urge the UK Government to reconsider the severity and timing of these changes and make changes before the Welfare and Work Bill reaches its next legislative stage, so that the poorest households in receipt of tax credits can be protected from this fall in their incomes.

“This shows why we need more social security powers through the Scotland Bill and why, we will ensure our approach to social security will be based on fairness and that people are treated with dignity and respect.”

Don’t lose out: tax credits deadline looming

moneyWith the tax credits renewal deadline of 31 July just ten days away, HMRC has revealed the top 10 excuses for not renewing tax credits claims.

Excuses given by claimants to HM Revenue and Customs (HMRC) for missing the deadline include:

  • I didn’t need the money because I’d met a rich bloke, but he dumped me
  • My mum usually does this for me
  • The form was locked in the boot of my car, and then my car caught fire
  • My baby used the paperwork as a colouring book
  • My dog ate the form
  • I got confused with the 31 January Self Assessment deadline
  • I booked the last two weeks of July for a holiday and forgot all about it
  • I’ve been in hospital but am feeling much better now
  • I was unable to get income details from my employers in time
  • I thought I’d already renewed

Claimants have until the 31 July deadline to renew, or their payments might end – last year more than 650,000 failed to renew on time. This year, for the first time, claimants can renew online, at GOV.UK, as well as being able to renew by post and phone.

Nick Lodge, Director General of Benefits and Credits, HMRC, said: “By 15 July over 203,000 claimants have renewed online. It’s a quick and easy way to do it. Renewing tax credits on time is important. People who don’t renew by the deadline can, and do, lose their payments.”

HMRC asks all claimants to check the accuracy of the information in their renewals pack, and to tell the department about any changes to their circumstances that they haven’t already reported, such as to their working hours, childcare costs or pay.

Granton Information Centre’s Caroline Pickering said: “There has been quite a big media campaign to remind people that they must renew their claims, and it really is important that they do so by 31 July. Many of our clients first approach us with money problems, and any loss of income can have really serious consequences for families who are often living on the tightest of budgets”.