TaxPersonal TaxFamilies face tax credits repayments

Families face tax credits repayments

Thousands of families could be forced to repay tax credits to the Inland Revenue because they were issued too much money.

Link: NAO targets tax credit debacle

At the end of the tax year the Inland Revenue will assess the amounts of tax credit people were entitled to and the amount they were paid. Those who received too much will be asked to repay the outstanding amount.

If an overpayment arose because the claimant made an error on the original application the Revenue could even issue penalties and charge interest on the outstanding amount. The Revenue, however, will not pay interest on mistakes it has made on underpayments.

The department has promised to ‘look sympathetically’ at cases where repayment would cause families ‘hardship’ but has also threatened to ‘take possession of, remove and sell your personal property…issue a summons…[or] take bankruptcy action against you’ if payment is not forthcoming.

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