Tax Credit Fraud – The government crackdown

Tax Credit Fraud - The government crackdown

The Revenue has announced the launch of its latest campaign to identify tax fraud. They are looking to crack down on people, particularly the self employed, of fraudulently claiming tax credits. It is part on a government programme, in conjuntion with HMRC and Department of Work and pensions to combat error and fraud in benefits in credits.

After examining tax credit awards HMRC is writing to over 12,000 people whose claims it believes may not be genuine or accurate and warning them of their intentions. The letters are requesting evidence to support claims.

The Exchequer secretary to the Treasury David Gauke, is quoted as saying: “HMRC is determined to take a tough approach to targeting possible fraud among tax credit claimants. “Last year the government launched radical proposals to reduce the billions lost to tax credit error and fraud every year. These losses are unaffordable and unacceptable.”

HMRC are to use credit reference agencies as well as ‘data matching’ to identify patterns of fraud, and will also be employing investigators. Tax credits is deemed a high fraud area and every claim is going to be examined.

Any tax credit fraud deemed deliberate can be punished by criminal prosecution. This could result in imprisonment. Simple failure to notify HMRC of changes in income result in an overpayment to claimants will have to repaid.