2012 news

Some tax credit claimants may not have received payments they should have for periods before they made their claim (‘backdated payments’) because HMRC failed to notify them of their entitlement. As a result of our intervention, HMRC have now improved matters for new claimants, but disappointingly they will not revisit old claims unless specifically asked to do so.

The Government announced yesterday that they are to conduct a payment-by-results pilot on outsourcing the collection of tax credits debt. This could mean that people with overpayments of tax credits will be dealing not with HMRC directly, but with debt collectors who will be paid by results, and who may therefore be tempted to be less than scrupulous in the methods they use.

The Autumn Statement announced that the government will proceed with a scheme whereby employees may forfeit certain employment rights in exchange for shares in their employer company. Those shares will be exempt from capital gains tax (CGT) but may still result in an immediate income tax and NIC liability.

LITRG has commented on the tax credit elements of today’s Autumn Statement.