Tax Credits Compliance Letter - SELF EMPLOYMENT - ** RESOLVED **

[rainbo]

Hi all,

 

I have just received a letter from "HMRC Claimant Compliance". It states that it's a "Notice under the Tax Credits Act 2002 section 16(3) (a)" and is regarding my tax credits award to 5 April 2012. It says my claim has been selected for a review. It's asking me to send practically all my household and work paperwork and accounts and private documents (my passport & birth certificate) to them as part of this review. They want all my paperwork covering October 2011 - January 2012.

 

Now I don't understand why I have been selected? I am a single person, I work freelance as an actress (mainly background and extras), take home less than £5000 a year, work over 40 hours a week (especially once you factor in the time it takes to seek roles, go for auditions, advertise etc), been claiming WTC since March 2011 (and previously up until July 2010), submit tax returns every year and submit TC annual review forms all on time.

 

I have 1 month to send them everything.

 

Is this all 'normal'? Do I just send them the stuff (by Special Delivery!) and wait for them to return it all and make their decision?

 

Also, I'm a little concerned that it says "If you do not reply we will amend or stop your tax credits based on the information we hold" - that information SHOULD be correct as I do not falsify information, nor has any of my circumstances changed since last year's renewal. So what do they mean by this?

 

Many thanks in advance.

[sadone]

Sadly at he moment many low paid self employed workers are getting the same treatment. Seems that they are clamping down on many who's wages don't meet the minimum wage criteria for the number of hours you say they work.

 

To see what I mean have a look at this CAB thread over here..

 

http://www.rightsnet.org.uk/forums/viewthread/1956/

[honeybee13]

Hello there.

 

I'm moving your thread to the specialist sub-forum here that deals with tax credits. I hope you get the answers you need.

 

My best, HB

[rainbo]

Thanks honeybee for moving my thread

 

Sadly at he moment many low paid self employed workers are getting the same treatment. Seems that they are clamping down on many who's wages don't meet the minimum wage criteria for the number of hours you say they work.

 

To see what I mean have a look at this CAB thread over here..

 

http://www.rightsnet.org.uk/forums/viewthread/1956/

 

Oh dear. It doesn't look good, does it.

[sadone]

Of course It flies in the face of their own guidelines at the moment, but hey that never stopped them before has it.

 

If you can get it, I'd seek out advice from your local CAB.

[jadeybags]

I asked tax credits about them assuming self employed people earn at least minimum wage & the guy said he knows nothing about it, & it's not down as a change coming soon. Yet the Local authority did mention about it to a friend of mine when she had to take her self employed accounts down for her housing benefit review the other day.

So I don't know who's right & who's wrong. Can you imagine how many people will have to give up their self employed work & go on the dole? That'll do wonders for the unemployment figures huh?

[rainbo]

I asked tax credits about them assuming self employed people earn at least minimum wage & the guy said he knows nothing about it, & it's not down as a change coming soon. Yet the Local authority did mention about it to a friend of mine when she had to take her self employed accounts down for her housing benefit review the other day.

So I don't know who's right & who's wrong. Can you imagine how many people will have to give up their self employed work & go on the dole? That'll do wonders for the unemployment figures huh?

 

Yes, my LA asked for my first few months of S/E accounts, and they wrote to me saying their calculations showed I was making £9 per week and to provide proof that I was able to live on such a small amount. I pointed out that I am in receipt of WTC. I was made to put this in writing, despite their system having up-to-the-minute details from HMRC and DWP.... And that's where I am at with THEIR review at the moment.

 

 

Sadone - is it worth talking to CAB? I'm thinking - maybe naively - that if I submit everything they want, HMRC will see that I'm being paid correctly, and nothing more will come of it?

[sadone]

But you say you only earn't £5000 that year, and when you divide that by the amount of hours you say you're working it falls believe the national minimum wage per hour, and thats what they seem to be latching onto these days. Yes, this is how WTC will be judged when UC comes in, but they seem to be jumping the gun at the moment by demanding people earn the national minimum wage for the amount of hours you're declaring right now, even though the self employed aren't governed by those rules.

 

It's just more pressure from Cameron to withdraw help from low paid earners or 'scroungers' as he likes to see it. Unless you can provide written proof of hours worked (work diary, appointments diary, etc) they may do what they've done to many others recently and say you've been overpaid and demand all the money back.

[rainbo]

But you say you only earn't £5000 that year, and when you divide that by the amount of hours you say you're working it falls believe the national minimum wage per hour, and thats what they seem to be latching onto these days. Yes, this is how WTC will be judged when UC comes in, but they seem to be jumping the gun at the moment by demanding people earn the national minimum wage for the amount of hours you're declaring right now, even though the self employed aren't governed by those rules.

 

It's just more pressure from Cameron to withdraw help from low paid earners or 'scroungers' as he likes to see it. Unless you can provide written proof of hours worked (work diary, appointments diary, etc) they may do what they've done to many others recently and say you've been overpaid and demand all the money back.

 

I have to admit to not working out whether or not it fell within NMW - I just pay things (debts etc) when I have money, scrimp when I don't, and send in tax returns etc when required, so thank you for the reassurance

 

But your next bit about proof of hours makes me anxious and angry! How can I provide proof of hours worked??! If they want me to keep a timesheet starting TODAY, then I can provide that, but it wouldn't cover the period they're asking for AND it won't be solid 'proof' as it would only be my say-so.

 

(not having a go at YOU obviously, just the system! It's never-ending red tape and paperwork, how on earth am I supposed to get on with my life/work when it takes hours/days to wade through each pile of poo the system decides it wants me to deal with this time?? Only just managed to get my ex-husband through an ESA appeal and tribunal, and now they want him back in for ANOTHER medical, so we're onto round 2 of pink forms and medical papers for him.....sorry for the rant, and thanks for reading )

 

Anyway. I think I will "comply" and send all the stuff they requested, and see where it gets me. I have a feeling I shall be back here and queuing outside my local CAB in due course...

[sadone]

Best of luck and please come back and tell us the outcome as I know it will help others out there.

[rainbo]

Best of luck and please come back and tell us the outcome as I know it will help others out there.

 

Thank you, I will do This forum helped immensly when on the ESA roundabout with my ex-husband (I lurked and read, didn't join or post), it's the main reason/resource as to how/why we won the tribunal! So I have been dipping in the ESA threads, hopefully to pay-it-forward

 

Thanks for the support and reassurance, I will update with anything new in the meantime (hopefully nothing! lol).

[underdog13]

Best of luck with your appeal, Rainbo.

[Basia73]

I received compliance letter 1 month ago. I gave all required documents to my accountant about 3 weeks ago. But It looks like she forgot sent it in time. It was sent after required date. If HMRC will stop pay my tax credits for that reason, what should I do....It was not my fault. Will HMRC accept it ? I am up set because I did everything in time....

[honeybee13]

Hello there. I think you should be having words with your accountant if she missed the deadline.

 

My best, HB

[rainbo]

Anyone know how long it should be between them receiving all my info and me hearing back from them? Will it be via letter, or phone?

 

It's not urgent (yet), just wondering when to expect a reply - and of course I want my birth certificate, bank statements and work accounts back ASAP.

 

Thanks!

[Alastrum]

Hi,

 

I'm in the same boat as you. I just got my response back from them today: it came by letter, together with the return of all my documents, by registered post. It took about a week. In my case, they're stopping my WTC, which in my opinion is wrong, and I think they've misunderstood my circumstances, so I'm appealing against their decision. Good luck with yours!

[underdog13]

I'm in the same position as you, Alastrum. I think they are deliberately 'misunderstanding' people's circumstances as an excuse to stop their WTC. They clearly have targets to reduce payments and will do so by fair means or foul - probably to ensure they get a nice fat bonus for cheating people out money that is rightfully theirs.

 

My documents were returned by special delivery, Rainbo - I would imagine yours will be returned the same way. It took about 7-8 weeks for my documents to be returned.

Edited February 28, 2012 by underdog13
additional info

[sadone]

May I ask you what your circumstances were underdog? I'm trying to get a picture her of what they find 'unexceptable' when it comes to self employed work.

 

I know that some folks on the CAB Rightsnet forum are trying to do the same, for as you say until UC comes in, the Inland Revenue are sort of twisting/ignoring their own rules.

[underdog13]

I'm self employed, sadone. I run two different businesses, but according to them they don't qualify as 'remunerative work'. Funny how they are happy to tax me on the profits, though, isn't it?! Don't want to go into too many details in case they are monitoring the site.

[sadone]

May I ask roughly what your profit was each year as they seem to base a lot on that.

 

IE If you declare 30 hours a week you should be taking home at least the minimum wage times 30, even though as we both know minimum wage doesn't apply to the self employed.

 

Thing is this rush of attacking the lower paid self employed is getting out of hand imo. But still the job centers keep offering up self employment as a genuine way to bak into employment despite these massive pitfalls.

[jadeybags]

The trouble is, if they keep pushing it, people like myself will have to give in & claim things like housing benefit. I am holding off doing that, because I am managing, but I am entitled to it, about 30 a week on average. If it gets any worse than it is, I shall have to man up & do it, then they will have to support me in a way that at the moment they don't. And I can't be alone in that situation. They can't have it all their way. If they keep giving with one hand & taking with the other, it'll have to go both ways...

[underdog13]

The profit was a bit below minimum wage for the hours worked, I think that is the crux of the matter, sadone. They're not being honest about using this policy though, are they? They cite all manner of other feeble excuses, but don't state what yardstick they are really using because it is not policy yet and they shouldn't be using it.

 

Totally agree with you that the attack on the lower paid self employed is getting out of hand. If the idle pen pushers at HMRC knew anything about running a business, they'd know it takes a lot of work, often for little return initially, to get a business off the ground. Would they really rather have more people shoved on to Jobseekers?

 

The irony is these little Hitlers barely do any work all day, (according to one of their own members), collect a nice fat wage paid for by the tax payer and retire from their non jobs early to a ridiculously generous pension, paid for by......oh yes, us!

 

Ok rant over, lol. I just despise the hypocritical **** at HMRC.

[underdog13]

Couldn't agree more, Jadeybags.

Edited March 1, 2012 by underdog13
typo

[rainbo]

Received all my stuff back less than 10 days after I sent it - and GOOD NEWS. They "do not need to amend my award". And there was me all ready for a fight with them!

 

Thanks all - mods you can mark this as RESOLVED now

[Basia73]

good news:-) Can you tell me pls....did they stop payment when they been checking your case? I didnt get any letter from HMRC but they stopped credit tax payment....