The Tax Credit Gamble 13 May 2008

It's that time of year again. The Annual Reviews are dropping through letterboxes all over the country. Families throughout the land are praying that their Tax Credit gamble has paid off, and that they won't be facing huge overpayment bills - caused by changes in their circumstances not being entered onto the system, computer error, form scanning errors, incompetence, etcetera, etcetera, etcetera .....

This is probably a good time to go over the HMRC figures for previous years:

2003-2004
There were 5,670,000 claims for Tax Credits.
1,879,000 claims were overpaid by a total of £1,931,000,000.
That's 33.14% of all claims OVERPAID.

2004-2005
There were 6,458,000 claims for Tax Credits.
1,958,000 claims were overpaid by a total of £1,695,000,000.
That's 30.32% of all claims OVERPAID.

2005-2006
There were 6,480,000 claims for Tax Credits.
1,902,000 claims were overpaid by a total of £1,573,000,000.
That's 29.32% of all claims OVERPAID.

The figures for 2006-2007 are not available yet. (Well, HMRC have only had a year to get them together ....)

It is quite easy to see that Working Tax Credits aren't, in fact, working. And Child Tax Credit doesn't actually help one-third of the children that it is supposed to. For one-third of all claimants, they are left in a much worse position than if they had never claimed "Money With Your Name On It".

Normally very prudent with the cash they do have, one-third of claimants and their families are forced into debt by this benefit which is administered using the full weight of Tax law. Claiming again for 2008-2009? Even if you're just visiting this site, and don't have an overpayment at the moment, you have a 30% chance of being given one in the future. There are many people who have overpayment after overpayment - year on year! Debt, piled on top of even more debt!

That's the Tax Credit gamble!