I think Tax Credits suspect me of Fraud...please help..!

[Jbabes89]

Hi, I just wanted some advice as I think Tax Credits suspect me of Fraud. Please bare with me as it's quite a complex long winded situation...

 

I was sending both my children to nursery and was receiving approx £200 p.w in childcare child tax. I stopped working in December 2010 (with no prior notice). I didn't report this straight away as my children had to attend nursery at full cost for a further 4 weeks (4 weeks notice is required when terminating) and my mother is the M.D of the company I worked for and was trying to convince me to return in another area of the company. Everything was up in the air but as soon as it was clear I would not return to work I knew I had to inform Tax Credits (approx 6 weeks or so later).

 

Around this time there were several other changes of circumstance, my partner became entitled to DLA and we were therefore entitled to a disability element, he remained working but there was changes to his hours and income and we also moved. As soon as we had moved and been given his DLA I wrote a letter clearly marked "change of circumstance" and sent it to a Preston address. Over the next few weeks there was a change in our payments, they dropped considerably but did stay quite high. I assumed this was the childcare having stopped but the disability element boosting an otherwise normal C.T & W.T claim. We did not receive a new award notice.

 

In usual circumstances I would have chased for an award notice as I know the onus is on us to check but there was a lot going on for us as a family. I was being treated for depression and anxiety, my partner had suffered further severe fits and had to have an urgent C.T scan etc, there was ill health to immediate family members both sides and we had recently moved to a new area (all of which can be proven). I assumed the figures were right and plodded on until I received a Provisional Award last week with reduced figures and stating that I was working full time.

 

Called tax credits who said this was because I had failed to reply to a review about my childcare costs (letter not received) so the reduction was due to my childcare having stopped. I was honest and said I had no idea I was getting childcare payments and that I hadn't worked since Dec. I explained all of the above and asked what would happen now to correct the situation, I was told to wait until I receive my new award which would explain the over-payment but the tone of the gentleman was very much suspicious of everything I said.

 

My payments have since stopped (apparently I didn't renew but I thought I had done with said gentleman). I've now been told having given all the exact figures etc again that this will be sorted ASAP. In the meantime we are living from £33 C.B as my partner who is self employed has no certainty of work until September.

 

I've also been told that changes of circumstance are not accepted in writing so my letter will not have been acted on (could have replied and told me that), that it's coincidence my weekly payments dropped at the same time as the changes were submitted (no further explanation given) and strangely some of the changes outlined in my letter have been acted on but not others (?). I am now noting details of every call and names as I'm sure they have ballsed up big time.

 

My question is how long can they stop my money for, especially if they do think I've committed fraud? And secondly what is likely to happen to me? One lady sincerely apologized about the situation but others have taken a real tone and it's making me unable to function. I would never ever knowingly steal from anyone, my Dad is a P.C and I would never risk being with my children for such a small gain. Because of this we have actually been underpaid in the Working Tax element of our claim and lost out on some Housing & Council Tax Benefit which cannot be backdated. We also now have potentially a big debt hanging over us.

[backofbeyond]

This link is direct to HMRC website and it states you can notify of changes by writing and telephone so you have an argument there. Did you send the changes by recorded delivery (i.e. do you have proof it was received)?

[Jbabes89]

Hi again Backofbeyond,

 

I thought that too as I took the instruction and address from their website. I've taken the name of the lady who told me you can't report changes in writing, noted the date and time of call and made notes of her comments during the call.

 

Nope it was sent via standard 2nd Class. In future I will always be sending it via recorded delivery.

 

Surely they won't pursue this if I accept the over-payment and make arrangements to pay. Plus I can prove there was no financial reason or gain for to have deliberately have committed fraud. My biggest worry is how long they expect me and my family to survive without our tax credit payments. Thanks

[backofbeyond]

Like I said before I would put everything down in writing and send it to them. Explain you sent changes etc and that you fully thought you'd renewed.

 

I know writing is a long winded way but if you're anything like me I get tongue tied and it is difficult to prove what you have said.

[Jbabes89]

Well I spoke to them last on Friday. The second lady I spoke to who was a lot more helpful and apologetic said now they have all the changes correctly and I've given my figures for renewal (again) the system says it will be dealt with ASAP but there is no time scale for re-instating payment.

 

I'm hoping by this Friday the payments should be in as I've not been told by any of them that payments have been stopped because I'm under investigation but purely because I did not renew. I'm planning to ring mid week to check progress. If they haven't re-instated it means we will have spent weeks living on £33.00 in which case I will write or if they contact me stating they suspect me of fraud I will write to explain all of the above (I have already explained in full verbally to several advisers).

 

I just need to know whether they can stop all your payments whilst they review/ investigate. If they can I wish someone could tell me how long this could be for, I've asked the advisers but as they are stating it's purely down to the renewal I'm not getting any definitive answers!!

 

Thanks for your help backofbeyond.

[backofbeyond]

If they have all of your details correct now then you will have to play the waiting game unfortunately. I would have thought though it would be dealt with as a priority.

 

I think changes on their system generally take 48 hours but at the minute everything seems to be taking sooo long with them!! I renewed on 05 july and still haven't heard anything.

 

I wouldn't worry about an investigation and would put that to the back of your mind. From previous posts they do notify you if they are investigating and ask for extra info etc so as you haven't received these I think it is doubtful.

 

Easier said than done but don't worry x

[Jbabes89]

I'm trying to put it to the back of my mind as much as possible.

 

They did apparently send me a review letter requesting my childcare proof etc as some of you have mentioned. I didn't get this as it was sent to my old address (again new address was in my letter sent early in the year). They have confirmed this and I can prove I wasn't living there so it wasn't a case of me deliberately ignoring the letter. Not sure how they got my new address though as this is where the Provisional Award which raised alarm bells came to, if something had of been sent sooner i.e the review letter to correct address this could have been stopped before it did.

 

My sister keeps telling me to keep calm and tell them I don't appreciate being spoken to like a criminal but like you said easier said than done, my biggest fear is that they don't believe me and lock me up away from my kids. I have no proof that the letter was sent so it comes down to whether they believe I sent it or whether they think I've knowingly pocketed childcare money.

[backofbeyond]

Did you notify child benefit of your address change? If so it will have been changed on tax credits system also, the same goes for bank account changes so think mystery may have been solved on that one for you.

 

YOU WILL NOT BE SENT TO PRISON so push that thought right out of your brain. Hmrc very rarely prosecute and when they do it is organised fraud. there are many threads on here with regards to overpayments on childcare, some are over £30k. What hmrc are interested in is having the money back and they will claim this through your new award. It is generally between 10-25% dependant on the circumstances of your claim.

 

Have a read through some of the previous threads regarding tax credits - they start with people worrying about jail etc and it ends with them saying everything has been sorted and they are paying it back each wk / month from their future payments.

 

Please stop worrying x

[Jbabes89]

Update for you backofbeyond..... no prosecution or fraud investigation etc. But I am only receiving £3.26 a week in child tax now to balance out the over payment. I've told the lady who I spoke to that my family won't survive on that combined with my partners 16 hour a week wage and our C.B. Our electric and gas alone is £200.00 per month.

 

Have you any idea if this is negotiable? I can't stop crying, if they don't negotiate we will lose our home and spiral further into debt . They say doing it this way will balance it out so I don't have an over payment hanging over us next year but I would rather that and phase it out over a couple of years than have such a harsh drop... probably should just be thankful that they've accepted my explanation but I don't know how we will cope with £3.26 a week!

Edited August 15, 2011 by Jbabes89

[backofbeyond]

Oh my god, £3.26?!?!?! Surely that's not right?!?! How much of a reduction is that per week?!?!?!?!?! Did you ask how much you've been overpaid?!?!?!?!

 

You can appeal it - I am not at pc at minute though, I'm on my phone so as soon as I can I'll have a look but someone more knowledgable may come on in the meantime.

 

Hugs to you xxx

[Jbabes89]

It's approx £100 per week I think having checked on the calculator and the over payment is approx £6000- £7000 by my working out. Lady I spoke to tried her best to explain but she couldn't be more specific, not sure she understood it herself, I've gotta wait til the new award letter comes.

 

We will get some working tax too but I've just put all the revised figures into my monthly spreadsheet and we will be left with more money out than in every month between now and April 2012, struggling to see anything I could chop out or adjust either. I'm preparing a financial statement ready for them to demonstrate we can't cope and I'll ring CAB later on too.

 

Any info you find when you are at PC would be greatly appreciated. Thanks a lot for all of your help xx

[backofbeyond]

Right i've just looked on HMRC website and this link basically states that if you cannot meet your living expenses to contact them and they will go through the various options with you. I find the whole overpayments thing very complicated but this states how they collect it which doesn't seem to ring true with what you have been told - dependent on your circumstances they'll take either 10 or 25% - this can be found here

 

Have you used the Entitled2 calculator? This also tells you what other benefits you may qualify for.

 

I know HMRC have told you to wait until you get your new award notice but it may be worth ringing again and getting them to clarify payments to you. You may get someone who is prepared to give you other options or explain it more clearly.

 

xxx

[backofbeyond]

Well i too am now in a blind state of panic?!?!?!?!?!?!? I have received a letter from HMRC advising that my claim has been selected for a review.

 

We claimed childcare last year (and previous years) and I didn't notify them until November 2010 that we had stopped receiving. Obviously the childcare providers have confirmed this also. They are asking me to confirm the findings by 25 August and they will then amend my award accordingly.

[Jbabes89]

Oh gosh, how long did you receive the incorrect money for? Have you been honest with them? I don't like the way they talk to me now, always suspicious but at the end of the day I told the truth and it was a genuine error. I'm glad at least that the only implication is a financial one.

 

Just had a Provisional Award, it states that I have been overpaid £6558. Phoned again, they are not classing it as an over payment or any fraud, just that I did not notify them in time and therefore they are paying £2.86 per week so that by the start of the new tax year April 2012 I will have been paid the correct amount for April 2010-April 2011 and April 2011-April 2012 then that will be the end and our payment will resume to normal.

 

In a way this is good but in another it would be better to be classed as overpaid then pay back at a rate of 10/ 25%. Apparently I can ask but usually when done this way it's non negotiable

[backofbeyond]

Stupidly no I didn't notify them until November 2010 BUT we did notify them - I have read a lot of these posts on here where people are only coming clean once they have received a letter so surely that has to go in my favour?!?!?!?!?

 

I wonder whether yours is being treated differently because they ended your claim (because they said you didn't renew) and then started it again? Just wondering that because none of the other threads have been treated that way.

[Jbabes89]

I don't know. Maybe it's because they can see they made faults their end too i.e they know I did write about the changes and until now they have been writing to the wrong address despite the fact it was supplied and that DWP and Child Benefit had it. Plus I called them as soon as I was aware of the discrepancies and told them exact dates etc

 

Honesty definately counts for something so I wouldn't worry just yet. I wish they had treated mine as an over payment, I'd rather be in debt to them for a few years than go this route and have £2.86 a week until April. Seriously depressed now looking at finances.

 

I'm wondering whether maybe they haven't done this because they believe me, maybe it comes down to this way they don't have to wait ages to recoup the money and this way I can't negotiate it. Worked out better for them hasn't it! xx

[backofbeyond]

I cannot see how they can leave you in hardship - I really can't! I mean from what you have said it's not like you are on huge wages and will be able to survive without them.

 

Do you think if they won't budge you would be able to claim other monies such a housing / council tax benefit?

 

I hope that you get it sorted.

 

With regards to mine; well i'm just going to have to wait and see, there's nothing more I can do really.

 

We had a hell of a lot going on last year, a hell of a lot and yes I claimed for longer than I should BUT i did cancel it in November. Lots of posts on here have waited until they were being investigated before they have owned up to any wrongdoing and have simply been given an overpayment figure to be taken from existing / future awards.

 

xx

 

x

[Jbabes89]

We can now claim Housing and Council Tax Benefit and I will be trying to backdate that to when I first became aware of the discrepancy as this is when everything changed. How much luck I'll have with that I don't know. Problem with H.B and C.T.B is that 1) Our rent is more than the figure they can pay for a family of our size so a shortfall will be needed from us 2) We already have arrears with council tax so although this figure will reduce we will still have to pay the arrears to date for some time.

 

Aside from that, my Partner gets lower rate DLA but some of that is deducted by DWP for a previous social loan when he was unemployed and my he works but on average only 16 hours a week at the moment. We aren't eligible for other benefits as we don't meet the criteria.

 

I'm sure everything will be fine for you, you came forward sooner than you could have and sooner than others and I think they bare personal circumstance in mind. xx

[backofbeyond]

I take it you are private renting? We are too which is a bloody nightmare as hb / cb pay 2 wks in arrears so we struggled not to fall into arrears.

 

We have just signed off jsa as we both have new jobs (my husband started yest and I start tomorrow) so hb will stop which will be a nightmare if tax credits reduce my payments dramatically.

 

X

[Nystagmite]

Aside from that, my Partner gets lower rate DLA but some of that is deducted by DWP for a previous social loan

 

This can't be right. Have a look at http://www.newcastle.gov.uk/core.nsf/a/wr_directdeduct#how

 

As for the £200 a month gas and electric - shop around and see if you can get a cheaper deal elsewhere.

[Jbabes89]

Hi Nysatgmite,

 

We thought that too, initially he was receiving his full amount and then it reduced by £50 each payment, we then received a letter explaining the deduction from DWP. My partner phoned and was told he could dispute it but decided not to at the time as at least it meant another debt was getting paid.

 

As for the Gas and Electric, the £200 a month is to incorporate a debt as we got landed with due to a much higher bill than expected when we first moved into our new house. So £200 covers the debt and our existing. Our existing alone is £140 though because we have an ancient boiler which is completely inefficient.

[Jbabes89]

Yep we private rent, spent years on the council list without any joy so had to rent privately, there are council houses round the corner, same nice area, nice houses, same size but half the monthly rent!! I have two friends who got council houses at the click of a finger even though they weren't in desperate need but we were in a one bed flat with two kids and couldn't get one at all.

 

If you're tax credits drop dramatically you may still get H.B, it depends if you weekly income is higher than total applicable amount you need to live on. My council has a H.B calculator, maybe see if yours does and it should tell you.

 

Hope everything works out ok anyway and good luck with your new job x

[backofbeyond]

Thanks jbabes89 x

[backofbeyond]

Well nothing to update as yet for me how about anyone else?

[backofbeyond]

Well my situation has just got even more bizarre and I don't know what to think

 

As you know I was being "reviewed" with regards to childcare and I sent in full disclosure about 2 wks ago (estimated I owed approx £8000) and I presumed that this "review" was the reason my renewal hadn't been processed because I sent it in at beginning of July and then the childcare letter turned up 5/6 weeks after. Well...........checked my bank as normal this morning and an extra payment has been paid (more than I normally get per week by approx £10) so I called them and was advised that my award had been finalised and it had generated an extra payment and that my weekly figure has increased per week.

 

Now my question / worry is; what has happened with regards to the overpayment I have received?!?!?!?!? If my figures have gone up then it's obvious they are not taking any money back. Does this mean that they are going to recover it in a different way (prosecution etc?!?!?!?!?!?!).