Tax Credits News from the ATT

Important Tax Credits news

The ATT would like to pass on to members two important pieces of news that HMRC have recently advised us about during a conference call.

Firstly, on 17 November 2014 HMRC will be launching a very small pilot using 1,000 Tax Credit claimants. HMRC will be looking at instances where data it holds from the RTI system does not match data that a Tax Credit claimant has provided in respect of their current year income. Claimants selected for the pilot will receive a text message from HMRC telling them that the data does not match and asking them to contact HMRC to discuss the issue further. Claimants will need to check the text message carefully to see whether HMRC intend to make changes to their award in the event that they do not contact HMRC. Members will need to be advising claimants who receive one of these texts and seek their advice that RTI data will not include any allowance for deductions for pension contributions or gift aid so claimants should not just accept that HMRC data is correct.

Secondly, The Department of Work and Pensions is intending to run a trial of the Digital Universal Credit system at the end of this month in Sutton, South London. HMRC has advised that whilst this trial is on-going it will not be accepting Tax Credit claims from people with a specific post code within the trial area. HMRC has not yet released details of the post code area affected. It has, however, indicated that from Thursday 6 November its advisors will be telling people in the affected area who contact them in respect of a Tax Credit claim that they must get their claim form in to them before 26 November 2014. If the claim is received after this date, the claim will be rejected and the individual will have to claim Universal Credit as part of the trial. Certain individuals may be placed at a disadvantage if a Tax Credit claim would have proved more beneficial for them.