2006

Some crumbs of comfort for students, but tax is still a problem On 6 December 2006 the Chancellor announced a package of measures to encourage students to volunteer, and to continue in education or training, but nothing to ease the primary tax issue for most full-time students, which is how they can stop too much tax being taken from them. 20 December 2006
Modest increases for pensioners due from April 2007 In his pre-Budget report the Chancellor announced increases in the rates of retirement pension, state pension credit, and age-related tax allowances broadly in line with inflation. 14 December 2006
Sir David sets out a better deal for the taxpayer We were pleased to see that the Varney report on Service Transformation, which was published alongside the pre-Budget report, draws attention to many of the service delivery issues which LITRG have highlighted over the years. 11 December 2006
Christmas risk for tax credits claimants The Paymaster General has announced that one of the changes to the tax credit system promised last year – an automatic restriction on how much overpaid tax credit can be recovered at any one time from low-income claimants – has had to be delayed. This could put the more vulnerable claimants at risk of financial hardship, and we are asking HMRC to suspend collection of all overpayments from those claimants until the technology is in place to deliver the improvement. 6 December 2006
Chancellor sets literacy target for taxpayers With the tax, tax credits and benefits systems growing increasingly complex, the Chancellor’s programmes to enhance adult literacy and financial inclusion could not have come at a better time for taxpayers and tax credit claimants. 6 December 2006
Pensioners with annuities face continued injustice For years pensioners with certain types of pensions (annuities) have had too much tax deducted from their payments. Often those pensioners have not known that they have been overcharged, or how to recover the overpaid tax. Now, to add to their pain, HMRC are refusing to repay overpaid tax that is more than six years old, despite the Department’s own delay in telling the pensioners that they have been overcharged. 23 November 2006
Council tax payers with disabilities need more help A recent LITRG review of local authorities’ websites (see link below) shows a patchy performance by Councils in publicising relief from council tax for taxpayers with disabilities. 26 October 2006
Fair and accessible tax appeals for the unrepresented In a new Report, the Low Incomes Tax Reform Group (LITRG) considers how to reform the system of tax appeals to the best advantage of unrepresented taxpayers with limited means to pursue an appeal. This group is likely to form the majority of appellants before the tax tribunals. 21 September 2006
Tax Appeals - a low income perspective Following the Leggatt report and the Department for Constitutional Affairs White Paper, LITRG has participated in consultations on tribunals reform. We have considered specific aspects of the proposals for reforming the tax appeal tribunals for a user on a low to modest income, probably without professional representation. In our report Tax Appeals - a low income perspective, we look at the reform for the unrepresented appellant and make recommendations designed to remove the barriers they face. 21 September 2006
HMRC wait while the poor get poorer HMRC are still silent about whether they are going to review again the tax credit cases where they made errors and then refused to write off the overpayments that these errors caused. LITRG proposed a review of these cases and back in June the influential Treasury Select Committee agreed that this should be done. 7 September 2006
Childcare vouchers... at last some realism from HMRC For eighteen months LITRG has been calling for HMRC to explain why childcare vouchers are unlikely to be a help for those on low or modest incomes. HMRC’s latest guidance explains many of the pitfalls. But there remain other ways in which HMRC could help people struggling to understand the interactions between different types of childcare support. 9 August 2006
Don't let Tax Credits put you off Pension Credit A recent research report from the Department of Work and Pensions shows that the horror stories of tax credit overpayments is putting off some pensioners from claiming State Pension Credit. But in reality claiming the Pension Credit is nowhere near as beset with difficulty as claiming Tax Credits. 7 August 2006
Disabled trusts - the latest developments Robin Williamson, the Low Incomes Tax Reform Group’s Technical Director, considers the latest position regarding disabled trusts as a result of the Government’s proposals for bringing most life interest and accumulation and maintenance settlements within the charging provisions applicable to discretionary trusts. 2 August 2006
LITRG view of Treasury Committee tax credits report Robin Williamson, the Low Incomes Tax Reform Group’s Technical Director, considers the report of the Treasury Sub-Committee on the administration of tax credits This article was originally published in Tax Journal on 24 July 2006 and it is reprinted here with the publisher's kind permission. 25 July 2006
HMRC Interventions - Real help or a quicker way of collecting money? Starting this month (July) HMRC are trying out new methods of approaching taxpayers who HMRC think might not be doing everything right in relation to their tax affairs. In explaining their prospective approach in a consultation document HMRC have used comforting words like “coaching” and allowing HMRC to “advise business on any changes required to their procedures”. Should taxpayers co-operate? The answer is, it is too early to say. 18 July 2006
Tax credit overpayments: how to challenge them Statistics published in May have confirmed that the level of tax credit overpayments in 2004-05, the second year of the system’s operation, has fallen not far short of the 2003-04 total, at £1.7bn. This sharply focuses the financial distress suffered by many low-income families from whom overpayments are being recovered well in excess of their ability to repay. Is there any way families can challenge a demand by HMRC to repay tax credits overpaid to them, and received by them in good faith? 14 July 2006
Last chance to avert tax threat to disabled people Even after intense lobbying by a group including several mental health charities, and a debate in the House of Commons, the Government’s proposals on the taxation of trusts still pose a serious threat to many disabled people who rely on trusts to manage their financial affairs. The forthcoming debate on the Finance Bill in early July will probably be the last opportunity for many years to remove this threat, and we urge the Government not to miss it. 28 June 2006
LITRG reminds HMRC that taxpayers have rights HMRC’s recent consultation exercise on Modernising powers, deterrents and safeguards fails to reflect wider social and legal developments, whereby individuals are viewed as citizens who have rights which must be respected. This is the key message in LITRG’s response. In particular, we are concerned that the consultation document has not fully considered the rights and needs of individuals on low incomes. 28 June 2006
Tighter tax return deadlines - LITRG response LITRG has highlighted concerns in our response to government that the proposals to move to greater online filing of tax returns and separate, earlier, filing dates for those who continue to submit paper returns has been given insufficient consideration by the government. 22 June 2006
MPs echo LITRG's call for fairness in overpayment recovery The Treasury Sub-Committee of MPs, in their report on the administration of tax credits, have adopted one of LITRG’s main recommendations to achieve greater fairness in the way HMRC decides whether to collect, or to write off, tax credit overpayments that arise from official error. 7 June 2006

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