Has anyone any experience of dealing with a client who has had a tax credit enquiry?

Client has received a letter saying IR is coming to her home to enquire into her finalised award. She has been asked to provide a bank statement, mortgage or rental agreement, statements for all credit cards, recent houshold bills, a council tax statement, details of her earnings, a copy of her childcare provider and receipts for all childcare payments.

When I called to ask why the enquiry was being done I was told nothing. When I asked why she had to provide all the information requested I was told it's because 'Tax credit awards are means-tested'. It was only when I explained that only income and not ougoings are considered that the compliance officer dropped her frosty and decidedly patronising attitude and started to stutter and stumble.

Client was given a copy of the code of practice 27 but I wonder how much will be adhered to. I'll let you know how it goes.

Have had one or two past experiences of "compliance officers" when WFTC was about. And I'm afraid the methods they were using to interview clients were a bit over the top. One client said they felt scared and intimidated by the examination and there was noticeable reference by them to how fines might be administered if client failed to give full co-operation. That case concerned a matter of alleged co-habitation which I felt was easily contested but client would'nt allow me to help in the belief they would penalise her for appealing her case.

When I first contacted IR compliance, who tend to be local officers, it was obvious they knew little about the legislation for the benfit. They had sent a letter to my client, and this happened to a colleague with one of his, declaring that they had instructed the office paying benefit to stop the award and to recover an overpayment immediately. When the officer was contacted and asked if he had the powers of a decision maker he stuttered and stumbled much the way yours did. I think the officers concerned are more used to investigations of tax than tax credit and unused to someone like a benefits advisor looking over their shoulder, especially if the advisor is more bolshie than an accountant would be.

CP 27 does mention that a third party can act on the clients behalf which might give you the opprtunity to suss why they are looking and what for. Watch out re: the request for evidence of outgoings as they might be attempting to prove the client has more income coming in than has been declared for tax credit. Whole new ball game now but "compliance" are on a learning curve as much as we are.

I would also look back to postings by jj and carol laidlaw on 5/2/04 and 2/3/04 respectively in this forum which covered similar situations and had some good advice.

Thanks.

I checked the two previous postings and they were extremely helpful as client is separated from her husband and we suspected this is the basis of the enquiry.

Don't know if you may already have seen it but I was into the Child Benefit site and theres a link to a Compliance manual which has quite a bit on establishing cohab.

http://www.inlandrevenue.gov.uk/taxcredits/tax-credit-checks.htm

Cheers, Semitone; I hadn't seen it. There's a lot of stuff and I certainly don't intend to read it all but I thought it may be an idea to photocopy it and bring it to the meeting just to freak the compliance officer out!