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Tax Credits

Volume 450: debated on Wednesday 11 October 2006

To ask the Chancellor of the Exchequer (1) how many (a) automated and (b) manual tax credit payments have been made in each month since April 2003; and if he will make a statement; (75817)

(2) how many interim payments of tax credits have been made in each (a) month and (b) quarter since April 2003; and if he will make a statement.

The approximate numbers of automated tax credits payments made in each month since April 2003 are given in the following table.

Month/year

Number of automated payments (Thousand)

April 2003

8,500

May 2003

9,000

June 2003

9,650

July 2003

11,250

August 2003

10,450

September 2003

11,050

October 2003

11,700

November 2003

10,250

December 2003

13,000

January 2004

10,400

February 2004

10,400

March 2004

12,450

April 2004

12,650

May 2004

13,350

June 2004

13,650

July 2004

13,750

August 2004

12,450

September 2004

12,950

October 2004

12,250

November 2004

12,150

December 2004

14,350

January 2005

10,600

February 2005

11,450

March 2005

13,800

April 2005

14,250

May 2005

14,100

June 2005

14,900

July 2005

14,150

August 2005

14,100

September 2005

14,100

October 2005

12,950

November 2005

13,200

December 2005

15,300

January 2006

12,500

February 2006

12,800

March 2006

14,700

April 2006

13,950

May 2006

16,600

For the numbers of manual, including interim, payments made since April 2003, I refer the hon. Member to the answers I gave him on 29 November 2005, Official Report, columns 343-44W and 5 June 2006, Official Report, columns 188-89W.

To ask the Chancellor of the Exchequer why tax credit payments are not made when the award falls below the payment threshold; and why these payments are not carried over to awards in future years. (76207)

Tax Credit regulations confirm that tax credits will not be paid where the award is less than £26 a year. This is because it is administratively disproportionate to pay such small sums.

To ask the Chancellor of the Exchequer what plans he has to eliminate opportunities for fraud created by the tax credits £25,000 income disregard; and if he will make a statement. (76418)

HMRC takes fraud very seriously and has a range of checks in place throughout the life of each claim. If fraud is suspected, payment is stopped. It would be inappropriate to give specific details as this could aid those seeking to gain through fraud.

To ask the Chancellor of the Exchequer what plans he has to introduce a pause before recovery of overpaid tax credits. (76425)

I refer to the comments made by my right hon. Friend the Chief Secretary on 7 June 2006, Official Report, column 293 and to my own of the same date, Official Report, column 326-27.

To ask the Chancellor of the Exchequer what plans he has to introduce a statutory right of appeal for tax credit overpayments. (76426)

I refer the hon. Gentleman to what I said about appeals in the Opposition day debate on tax credits on 7 June 2006, Official Report, column 327.

To ask the Chancellor of the Exchequer what plans he has (a) to collect and (b) to publish additional data on the performance of the tax credits system; and if he will make a statement. (76474)

HMRC publishes a wide range of statistics about tax credits on its website, reports and annual accounts. They keep this under review and will continue to consider publishing additional data on the tax credits system as appropriate.

To ask the Chancellor of the Exchequer (1) what criteria for tax credit overpayment write-off were used (a) before and (b) after the streamlined procedure was introduced in spring 2005; and if he will make a statement; (76476)

(2) whether the tax credit recipients who are challenging tax credit overpayments have been treated under different criteria since December 2004; what changes in criteria there have been; and if he will make a statement;

(3) for how long the streamlined procedure introduced in spring 2005 was used to clear the backlog of disputed tax credit overpayments; how many overpayments were written off under this procedure; what the value was; and if he will make a statement on how this procedure differs from that currently applied;

(4) how HM Revenue and Customs selected the criteria in relation to the streamlined procedure for clearing disputed tax credit overpayments introduced in spring 2005.

HMRC's policy on dealing with overpayments is set out in their Code of Practice - COP 26 - “What happens if we have paid you too much tax credit?”

Details of the streamlined procedures have been published in the Supplementary memorandum submitted by HM Revenue and Customs published in the Treasury Committee's report: The administration of tax credits: sixth report of session 2005-06: Volume 2 Oral and written evidence (page Ev193), House of Commons papers 811-11 2005-06.

The procedures were applied between 1 April 2005 and 30 September 2005 and covered outstanding disputed overpayments for tax year 2003-04 and those for 2004-05 where the award had not been finalised . Around 139,000 disputed overpayments were remitted under the exercise at a value of around £156.8 million. HMRC's 2005-06 accounts were published on 11 July and gave the total amount of overpayments written off for 2003-04 and 2004-05. Amounts written off are included in the remissions figures for HMRC’s accounts.

To ask the Chancellor of the Exchequer how many cases of tax credits fraud have been investigated by HM Revenue and Customs’ Special Compliance Office in each quarter since April 2003; and if he will make a statement. (76484)

The following table shows how many cases of tax credits fraud have been registered for a criminal investigation in each quarter since April 2003.

Quarter ended

Number of cases

June 2003

21

September 2003

61

December 2003

191

March 2004

341

June 2004

321

September 2004

400

December 2004

299

March 2005

212

September 2005

182

December 2005

153

March 2006

149

To ask the Chancellor of the Exchequer in how many cases investigations into tax credit fraud have been initiated after a letter had been sent to a tax credit claimant explaining that the money had been paid in error and was being written off. (80155)

To ask the Chancellor of the Exchequer how many letters have been received by (a) Ministers and (b) senior HM Revenue and Customs staff from tax credit office employees and compliance officers about the extent of tax credit fraud in the last 12 months; and if he will make a statement. (81151)

To ask the Chancellor of the Exchequer how many overpayment appeals in relation to tax credits were successful in each year since their creation; and if he will make a statement. (82012)

Customers have a right of appeal against decisions about their tax credit entitlement and are able to pursue with HM Revenue and Customs (HMRC) any disagreement concerning the recovery of an overpayment.

For the number of disputed tax credit overpayments Tax Credit Office (TCO) wrote off between May 2004 (when the Department began recording intake of disputed overpayment requests) and March 2006, I refer the hon. Member to the answer I gave to the hon. Member for Yeovil (Mr. Laws) on 18 July 2006, Official Report, columns 359-60W.

To ask the Chancellor of the Exchequer what the cost to public funds has been of research and development tax credit for large companies in each year since 2001. (89498)

Research and development tax credits were extended to large companies in April 2002. I refer the hon. Member to the reply given to the hon. Member for Burnley (Kitty Ussher) of 8 December 2005, Official Report, column 1454W, for the cost associated with claims received up to that point.

Updated estimates of the cost of support claimed under the large company scheme will be included in the National Statistics published on the HMRC website in December 2006.

To ask the Chancellor of the Exchequer how many fraudulent claims for tax credits there were in each constituency in England and Wales in each of the last three years; and what the total of fraudulent claims represented as a percentage of tax credits paid in each year. (91428)

The information requested is not available by parliamentary constituency and could be obtained only at disproportionate cost.

Estimates of levels of error and fraud on finalised 2003-04 awards were published on 11 July 2006 at:

http://www.hmrc.gov.uk/stats/personal-tax-credits/error-fraud.htm

To ask the Chancellor of the Exchequer how many demands for repayments of alleged overpayments of tax credits have been cancelled due to the Treasury accepting that (a) the overpayment was due to official error and (b) recovery would cause hardship. (91820)

The information is as follows:

(a) HM Revenue and Customs (HMRC) only seeks direct recovery of tax credits overpayments and issues notices to pay where an award has ended. HMRC does not separately record details of direct recovery cases where some or all of an overpayment has been written off due to official error according to the criteria set out in code of practice 26 “What happens if we have paid you too much tax credit?”.

(b) I refer my right hon. Friend to the answer I gave the hon. Member for Yeovil (Mr. Laws) on 4 July 2006, Official Report, column 998W.

To ask the Chancellor of the Exchequer how many tax credit forms were (a) issued and (b) printed in 2005; on how many occasions HM Revenue and Customs has informed applicants that there were no forms available; and what action a claimant should take if no forms are available. (91861)