Am I missing something or what?

Help / Guidance / or a gun needed.

Two cases both have in-depth involvement of local MP’s office, after we gave up arguing with the Inland Revenue. The MP’s office have now come back on the side of the Inland Revenue. This despite us quoting Reg’s.

Sinarios:

Couple (no1) with CTC at basic amount £11+ weekly based on earnings from last year at £30,000. The only earner goes sick in May getting full pay for 3 months, then onto basic SSP at £66.15 weekly. He then claims an Income Support top-up at £21.15 weekly all well and good.

We then tell him to contact the Inland Revenue and ask them to increase his CTC award to the full amount for three children (about £100 weekly) as he is now on Income Support (As per TCA Reg 7 (2) ) the IR say get lost it is yearly award and would not change it. They are now living on £90 weekly less than Income Support levels.

Couple (no 2) again only paid minimum CTC at £11 weekly due to high earnings from previous year. They split up so award ends. She reclaims for the two children only to be given the same amount £11 weekly, again she is by this time on Income Support at £55 weekly. Inland Revenue refuse to budge and insist that joint income until they split up is enough for her to only qualify for the basic Family Element at £11 weekly. She is almost £50 weekly below her IS applicable amount.

Local MP has backed IR by saying they are correct as CTC is a yearly benefit they cannot pay any more, this despite both being on IS.

Surely they are wrong?

If not do MP’s realise what they have done?

What are / can we as advisors doing about it?

There own guidance might help
http://www.inlandrevenue.gov.uk/manuals/tctmanual/TCTM07041.htm

Thanks Euan

Your a hero

Well that did not work?

Unbeleivable or what?

My local MP's solicitor once again contacted the Inland Revenue (They have a special number seemingly) after we faxed them the Reg's again and the IR's own guidance as per Euan above.

They have once again been fobbed off by the IR, who now say that any adjustment to the CTC awards mid year will result in an overpayment in April 05 once they re-assess the award. As they say the income for the year will still be over the limits to get any more than the basic family rate of CTC. So no increase.

They seem to have no concept of the fact that both clients would have been given child additions in full in Income Support pre April 04, and are now well under their basic IS amounts.

Now have to write explaining our concerns and the problems (In idiots language)to local MP who has agreed to take it up with ministers.

Bill McC

I thought this had all been sorted out. There was a long thread, under Tax Credits, MArch or April this year, which seemed to conclude with new guidance from Inland Revenue that anyone on Income Support should automatically get full CTC.

I sincerely hope that that is the case, otherwise I think I might give up all together.

Is there an appeal in as the Act/regs clearly work to passport people on IS onto maximum CTC.

There may be an issue of overpayment due to the annual nature of tax credits, but even if this were the case, regulations limit recovery to 10%, if you receive a Maximum TC.

Sorry 10% thing is for end of year recovery. This seems to be the IR using their powers to avoid a likely overpayment by adjusting the award in year without any consideration of the hardship they are causing.

Definitely a need to fight the good fight. Good luck.

Thanks all will continue to take this forward.

Found the earlier post mentioned above.

http://www.rightsnet.org.uk/dc/dcboard.php?az=show_topic&forum=104&topic_id=128&mesg_id=128&page=3

Have you applied for top up payments?

1. Your MP might take it up with Ministers (indeed, certainly should) but - unless things have improved since last year - will be lucky to get a reply. An MP wrote to Dawn Primarola 3 times for a client of mine. The only reply he got was a copy (months later) of a letter the TC Director's Office sent to us, which was a very belated (and unsatisfactory) attempt to answer queries we had raised.
2. You could go through the complaints machinery, ending with the Independent Adjudicator, but it would take months or years.
3. The last post by litr on the thread you mention above seems to imply this issue should have been settled months ago. Perhaps they could help through their contacts with IR.
4. As far as top up payments are concerned, I seem to recall reading on another thread that someone had them denied on the grounds that they would then owe more money which would increase the amount they already owed and had to pay back! Nonetheless, it could be worth a try.

Are you members of NAWRA? If so, we are represented on the National Tax Credit Liaison meeting and we would be interested in bringing this up at the next meeting. My contact details are on the Rightsnet page on the Steering Group list.

If not, can I suggest that you contact CPAG who are also members of the liaison group.

Sorry just to clarify, my contact details are on the NAWRA page of Rightsnet (via Swopshop) in the steering group list.

My understanding is that a top up should be paid to put you in the position you would be if an end of year overpayment was being recovered, i.e. in this case award minus 10%.

see CPAG page 1339 this also has a note which refers you to legislation. Anyone on IS should get the maximum CTC. Have you appealed? I think the IR should have done an in year revision. You can also go through the complaints procedure and if you have no joy then on to the adjudicator.

In vol 4 of the social security legislation 2003 (sweet and maxwell) p406 (general note) it refers to this stating:
'claimants receiving IS or IBJSA recieve maximum child tax credit. This is passported through and no calculation of income is neccessary'
see also p479 bottom of the page, general note again, referring to the fact that anyone on IS or IBJSA should not be subject to the usual income tests for CTC - s.7(1)of the TCA 2002.

The Inland revenue are wrong on this and I'm sure you are not alone in having problems getting through to them. I hope they'll compensate your client!