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CPAG Tax Credits E-Bulletin April 2008
Dear Colleague,
Welcome to the April 2008 edition of CPAG’s tax credits e-bulletin keeping you up-to-date with tax credits news and developments.
Contents:
CPAG news and events
CPAG leaflet on tax credits support for advisers
New and updated factsheets
Tax credits training
Tax credits news
Overpaid WTC not income - new DWP guidance
Disability help sheet
Income support transfers to CTC
Test case needed on offsetting
CPAG news and events
CPAG leaflet on tax credits support for advisers
Click here for a leaflet (500 KB PDF file) detailing all of CPAG's tax credits support for advisers, including our telephone advice lines, training courses, publications and the monitoring network.
New and updated factsheets
The latest in our series of factsheets providing information for advisers on a wide range of tax credits topics are now available. To request printed copies please email acarr@cpagscotland.org.uk
Click here to read or print other tax credits factsheets in the series.
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Tax credits training in London
Forthcoming one-day training courses include:
Click here to book a place or for further details contact the training department on 020 7812 5228 / 5217 or email training@cpag.org.uk
Download 32 page A4 programme (200 KB PDF file) or email training@cpag.org.uk to request a printed version.
'In house' training
Most of CPAG's existing courses can be provided 'in house' to meet the training needs of your group or organisation.
Providing a course 'in house' can be more cost effective - saving on time, travel and accommodation costs. We provide the expert tutor(s) and all the training materials. Please email training@cpag.org.uk or contact us on 020 7812 5228 / 5217 for more information.
Tax credits news
Overpaid WTC not income - new DWP guidance
Following new caselaw (CIS/1813/2007 reported in February’s e-bulletin) on when overpaid working tax credit can be ignored as income when claiming income support after stopping work, the DWP has issued new guidance. DMG Memo 07/08, states: 'The Commissioner's decision is binding case law in relation to the treatment of working tax credit income. If a person who has ceased employment confirms when they claim income support / JSA / pension credit that they have notified the Revenue of the change in their circumstances, Decision Makers should not treat any payments of working tax credit paid incorrectly by the Revenue as the claimant's income.'
It also appears that according to the new overpayment guidance, COP26, in these circumstances, where the claimant has met their responsibility to notify the Revenue of stopping work, and the Revenue has failed to act on the information, an overpayment of working tax credit should not be recovered.
- Click here to read DMG memo 07/08
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Disability help sheet
The Revenue has produced a new 5-page disability help sheet (TC956), which is aimed at simplifying the rules for disabled workers and the disability element. The definitions of disability are the same but are now grouped under separate headings of physical, hearing, visual and other disability. There is no specific heading for learning difficulties or mental health problems, but claimants with these conditions may meet one or more of the definitions under ‘other disability’.
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Income support transfers to CTC
Some families who have been getting income support or income-based jobseeker's allowance since before April 2004 still get benefit rather than child tax credit (CTC) for their children. The Government has repeatedly postponed transferring these claimants to CTC. At present, there are still no plans when, or if, the transfer will happen. In the meantime, the DWP is looking to target claimants who could be losing financially by not transferring. A ‘Gainers Exercise’ will be conducted with a scan to identify claimants who could be better off. The DWP will then contact them and offer them a better-off calculation and discussion, before the claimant makes a final decision.
Under separate plans, from October 2008, lone parents on income support whose youngest child is aged 12 or over will begin to transfer from income support to jobseeker's allowance. When they do, they will not have the option to continue getting benefit for their children and will need to claim CTC instead.
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Test cases needed on offsetting
CPAG is looking for cases where claimants have been overpaid for technical reasons, and there is no loss to the public purse, but the Revenue has refused to write off the overpayment. This usually arises where someone has claimed tax credits as a couple when they should have claimed as a single claimant, or vice versa. We believe the Revenue may be acting unlawfully if it is not prepared to consider writing off overpayments in these circumstances.
Please contact CPAG's solicitor Sarah Clarke if you think you may have a potential test case - sclarke@cpag.org.uk
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New version of COP26
A revised version of COP26, the HMRC's code of practice on tax credit overpayments was published in March 2008 and is available here.
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We would welcome feedback on the e-bulletin, please contact us at ksmith@cpag.org.uk with your comments. Thank you.
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