Tax Credits: Why So Complex? discussion



  • whitevanwoman
    whitevanwoman Forumite Posts: 351 Forumite
    HMRC have admitted that they have no effective exit strategy from the tax credit system. I think in the past they have terminated claims following customer request but only by putting an incorrect termination code into their computer system, to fool the computer into saying "no" ie by saying that your eligibility criteria has changed so therefore you don't qualify any more.

    Someone I know has been trying to exit the system for several years now - she was told to wait until tax year end before she could do so. She waited until she received the renewal pack for the following year and then informed them again as she had been told to do, that she wanted to leave the system and was then told that she was now too late to exit the system for the new tax year.

    So there is a Data Protection issue here - customer information being kept against customers wishes.

    There is a template letter instructing HMRC to terminate your claim on the website
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  • viktory
    viktory Posts: 7,635 Forumite
    I can't understand why normal posters are not allowed to have discussion on here - as this board is for advice only and yet here we have a discussion thread :confused:

    This would be better in DT - even those that don't come to this board claim tax credits you know.
  • whitewing
    whitewing Forumite Posts: 11,852
    Part of the Furniture 10,000 Posts Combo Breaker
    I only claim Tax Credits now because I have an accountant. I get him to confirm all figures I give to them, and he tells me what effect this should have n my payments.

    I ring up and give figures. Then I get the Award back. Then I give it to the accountant again for checking. And he queries when they have it wrong.

    I shouldn't need an accountant's help with it. It makes me cross.
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  • whitewing
    whitewing Forumite Posts: 11,852
    Part of the Furniture 10,000 Posts Combo Breaker
    Oh what a timely discussion. This is from an email from my accountant last week:

    your revised total annual reduction to your tax credits is expected to be around £35 (approximately £3 per month).
    I then rang tax credits and gave them my renewal figures (which the comment above is based on). Last month my tax credits were £144.66. I've just checked online banking and today's credit is £177.07. The paperwork won't come thro for a few days, but I won't understand it anyway.

    I am very grateful for the tax credit help; I just wish that it was easy to know what you should be expecting, then you could check. I'm a reasonably intelligent person but I can't fathom this stuff at all.
    :heartsmil When you find people who not only tolerate your quirks but celebrate them with glad cries of "Me too!" be sure to cherish them. Because these weirdos are your true family.
  • trekker2002
    trekker2002 Forumite Posts: 20
    Part of the Furniture 10 Posts Combo Breaker
    The system is a bureaucratic nightmare that is not fit for purpose.

    When Tax Credits were introduced I was working as a Lone Parent Adviser for Jobcentreplus and had to help my clients to claim it as part of assisting them to return to work. When I attended the training session about 6 months before it started, I was appalled at how complicated it was, especially as it is aimed at the part of the population least able to cope with complexity. In the training I told the course leader that this system would collapse under the weight of its own bureaucracy and many of my colleagues said the same. We were, needless to say ignored as we were far to low in the system to have any effect on policy.

    The previous system was far simpler and much better suited for purpose. The whole thing is a vast sinkhole down which billions of pounds of public money has poured. It is unreformable and should be scrapped and then used as an object lesson in what not to do.

    Bring back Tax allowances for children and for those who are not working pay the equivalent via whichever benefit they are claiming. This Government will not do that because a Tax allowance lets us keep more of our own money whereas Tax Credits enable them to claim that THEY are GIVING us something.
  • Blackpool_Saver
    Blackpool_Saver Forumite Posts: 6,599 Forumite
    This Government will not do that because a Tax allowance lets us keep more of our own money whereas Tax Credits enable them to claim that THEY are GIVING us something.

    Boy, does that EVER sum it up.................
    Blackpool_Saver is female, and does not live in Blackpool

  • Mr_Rhubarb
    Mr_Rhubarb Forumite Posts: 14 Forumite
    Yes Tax Credits have their problems, but they replaced a system of benefits that was infinitely worse. Before Tex Credits I was on disability Working Allowance and had to fill in a 28 page form every six months, and the calculations were always wrong, so I then had the stress of an appeal. Believe me, you don't want to be on the benefits system - TC is about the only good thing this government has done. It's not perfect, but the system it replaced was a million times worse!
  • ajadams_2
    ajadams_2 Forumite Posts: 1 Newbie
    They contacted me, I filled in the forms, they sent me money, the following year I told them again what our self employed income was a hey presto, we owe them money, so how the hell does that work! Every year they pay me and I owe them, I hate the stupid system, it's not meant to be understood by us mere mortals, I now owe them £1200 for which they have kindly offered me terms! My own govt has managed to get me into debt, my advice is if your are self employed don't get involved. Just this week they sent me 8 letters arriving on the same day 4 for my husband and 4 for me, 2 each the same! Ugh! Please Martin sort them out!
  • fruugal
    fruugal Forumite Posts: 22 Forumite
    Government gobbledegook is embedded in all government activity, and this is misrepresentational use of language which wastes more time and money than anything else. The government should be taken to task for misrepresentation, on each occasion on each document.

    So, Renewal isn't renewal at all and so on, ad infinitum.

    Perhaps the best way to tackle it is to find out what they really mean and want, rewrite it in plain and understandable english, and get the relevant minister to impose it on the civil servants involved.

    Why do they do it?

    The same applies to all Department of Work and Pensions stuff. You should see the problems I've been having for years including all the contradictory advice from different departments, offices, officials, etc., all to the same question. And, they have lost my birth certificate and other documents having insisted on receiving originals.

    All of government speak needs to be sorted as it is unfit for purpose.
  • rubix_76
    rubix_76 Forumite Posts: 216 Forumite
    Further, the notes give misleading or incorrect guidance regarding how to factor in contributions to pension schemes, ref: Renewal Pack book (TC603R), pg 22, top box re deductions for pension contributions; it states “Do not include pension contributions you paid through your employer. Your employer will have already deducted your contributions from the pay figure entered on your P60 or P45”. I believe that the pension scheme I am in is fairly typical these days; a defined contribution (i.e. not final salary), group personal pension scheme, where my contributions are all detailed on my payslips, administered via my company’s payroll, but they are not deducted from the total pay on my P60. So I do have to deduct the gross contributions, apparently contrary to the guidance.

    Hmm. . . . I have a similar issue with them, which I am going through the appeals process currently.

    I get childcare vouchers deducted as part of a salary sacrifice scheme through my job. These are only mentioned once, and as CJFC mentions similarly, it says not to include them when declaring income. BUT regarding childcare costs - no menton.

    BUT in HMRC eyes childcare vouchers should not be included in the "cost" of your childcare. SO if you get £400 in vouchers, and your max chilcare costs is £500, they say your childcare costs are £100 !!! This has only been menioned this year (on the phone as a side comment, and NOWHERE at all in their renewal pack literature) SO as my eledest is 3 1/2 and I have been claiming the wrong way since he was born (well at nursery) I owe them money - not sure how mcuh as yet.

    So whose fault is that then ! ? :eek:
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