CPAG in Scotland Tax Credits Project: Factsheet 2

Tax Credits and Complaints

Introduction
Knowing when to complain
Overpayments
The complaints procedure
Informal complaints
Formal complaints
Review by a senior officer
Make a complaint to the Adjudicator’s Office
Asking your MP to refer the complaint to the Ombudsman
Remedies
Further information and advice

Introduction

There are two types of tax credit; child tax credit and working tax credit. You claim them together and may get either or both. Tax credits are administered by Her Majesty’s Revenue and Customs (referred to as the Revenue in this leaflet).

Problems often arise with tax credits. Sometimes the way to sort them out is by making a complaint. This is a formal process and has a number of stages which are outlined below. However, it is important to know that a complaint is not always the appropriate, or only, course of action. For some problems, the right procedure would be to lodge an appeal or to request a judicial review. To find out more, see CPAG in Scotland’s factsheets Tax credits and challenging decisions and Tax credits and judicial review.

Knowing when to complain

The Revenue operates according a Charter, setting out claimants’ rights and obligations. 

You can expect the Revenue to:

• respect you
• help and support you to get things right
• treat you as honest
• treat you even-handedly
• be professional and act with integrity
• tackle people who deliberately break the rules and challenge those who bend the rules
• protect your information and respect your privacy
• accept that someone else can represent you
• do all it can to keep the cost of dealing with it as low as possible.

A complaint may be the right course of action when it looks as if the Revenue has not kept to these standards.

In return, the Revenue expects claimants to:

• be honest
• respect its staff
• take care to get things right

If a complaint involves a specific area of tax credit administration – for example overpayments, examinations or penalties, you can look at the leaflets and guidance notes on that particular topic. These can be found on the Revenue website (see below).

It may help to categorise at the outset what the complaint is about. It might be, for example, that:

• discretionary powers have been improperly used – for instance in deciding to recover an overpayment (see below)
• advice has been poor quality or misleading
• there have been long delays
• mistakes have been made, for example computer or processing errors
• staff behaviour has been inappropriate
• award notices have been confusing
• the Tax Credit Helpline has been difficult to contact

You can get copies of Your Charter and Complaints and putting things right (C/FS) and other official publications from HM Revenue and Customs website www.hmrc.gov.uk, from local Tax Enquiry Centres (details in local phone books) or the orderline 0845 9000 404.

Overpayments

Very often complaints are about the recovery of overpayments. As noted above, sometimes making a complaint is not always the most appropriate course of action. For example, if the Revenue has made a decision that you have been overpaid and that decision is wrong, you can appeal against it – so would want to lodge an appeal rather than making a complaint.

However, even where the Revenue has have made a decision that you have been overpaid and this has been calculated correctly, it does not have to automatically recover the overpayment. The Revenue should should use its discretion and decide whether to recover the overpayment or to write it off. So, if the overpayment has been correctly calculated but you think that recovery is unfair or would cause you hardship, you cannot appeal against the recovery but you can ask the Revenue to use its discretion not to recover the overpayment.

Official leaflet What happens if we have paid you too much tax credit? (COP26) explains the circumstances in which an overpayment may be written off. If you think the Revenue has not considered your request in line with the guidance in COP26 you should make a complaint.

The complaints procedure

Making a complaint is a process which must be done in the right order.

• Informal complaints
• Formal complaint to a Complaints Manager
• Review by a senior officer
• Make a complaint to the Adjudicator’s Office
• Ask your MP to refer the complaint to the Parliamentary Ombudsman

Informal complaints

Raise the problem informally with the Tax Credit Office first. You can ask to speak to a team leader or manager. Only if this line of action has been tried and failed should a formal complaint be considered.

Formal complaints

A formal letter of complaint should be headed ‘complaint’ and addressed to:

Complaints Manager
Tax Credit Office
PO Box 145
PR1 0SB

Include your name, address, national insurance number and contact telephone number if possible. Specify what you think is wrong, what outcome you would like and when you expect a response.

Although it is best to complain in writing, complaints may also be made via the Tax Credit Helpline, or in person at the enquiry centre you have been dealing with. You may also fax complaints on 01772 235420. Make sure it is clear that you are making a formal complaint. Keep a record of the date, time and details of any conversations regarding the complaint.

The complaint is allocated to a specific caseworker who gives the customer their name and direct line number, and maintains contact, normally by telephone, until the complaint is resolved or taken further. If an adviser is acting on behalf of the claimant, the complaint should be dealt with by a special Intermediaries Complaints and Disputes Team.

The Revenue states that most claimants are normally contacted about their complaint within 15 days.

Review by a senior officer

If you are unhappy with the response of the caseworker, you can ask a senior officer at the Customer Support Unit to review the complaint. Again, it is best to request this in writing but you can also do this by fax or phone.

This may resolve any outstanding issues. If not, the complaint may then be taken to the Adjudicator.

Make a complaint to the Adjudicator’s Office

If you have exhausted the Revenue’s internal complaints procedure, received a final response and are still not satisfied, you can ask the Adjudicator to investigate your complaint. The Adjudicator’s Office was set up as a fair and unbiased referee to look into complaints about the Revenue.

Contact with the Adjudicator must be made within six months of the outcome of the review. The Adjudicator will not deal with a complaint which has been or is being looked at by the Parliamentary Ombudsman or where the subject of the complaint is an issue for the courts or appeal tribunal. This means it is not possible to go to the Ombudsman first and then the Adjudicator. But it is possible to ask the Ombudsman to review a recommendation made by the Adjudicator.

The Adjudicator will try to negotiate a solution, but if this is not possible, will issue a formal letter of recommendation setting out what could be done to put things right.  There is no legal power to enforce this, but the Revenue will usually comply. Alternatively, the Adjudicator may find that the Revenue has acted reasonably, and confirm its action.

The Adjudicator may be contacted at:

The Adjudicator's Office
8th Floor Euston Tower
286 Euston Road
London NW1 3US

Tel: 0300 057 1111
Fax: 0300 057 1212
Website: www.adjudicatorsoffice.gov.uk

Before contacting the Adjudicator, it may be useful to look at:

• The Adjudicator’s Office leaflet AO1
• The Adjudicator’s Annual Report – detailing the type of complaints made and how they were resolved

These can be obtained from the Adjudicator’s office, or its website. AO1 can also be obtained from the Revenue’s local enquiry centres.

The Adjudicator’s Office aims to reply to your initial contact within ten working days. In September 2009, the time taken to investigate tax credit complaints was around 50 weeks, partly due to a backlog caused by a change in guidance. In 2008/09, the Adjudicator found in favour of the claimant, or the Revenue reconsidered, in 73% of cases and recommended that nearly £2 million in overpayments was written off.

Asking your MP to refer the complaint to the Parliamentary Ombudsman

Finally, it is possible to complain about the service received from the Tax Credit Office, or from the Adjudicator, to the Ombudsman. In most cases, because of the very high numbers of complaints about tax credits, the Ombudsman will only consider cases which have already been considered by the Adjudicator.

Referrals to the Ombudsman are made via your MP. The Ombudsman cannot be approached directly. The usual procedure is to approach your MP with details, asking that the case be referred to the Ombudsman. The Ombudsman's website (see below) has an online form that may be used to submit complaints to your MP. This should normally be done within 12 months of the outcome of the Adjudicator’s investigation. The Ombudsman will acknowledge receipt of your complaint within two working days, and shortly afterwards will write to you explaining whether they can help and if so how they will handle your complaint.

After making enquiries, the Ombudsman can make recommendations about how to put things right. There is no formal power to enforce these, but they are almost always followed.

The level of tax credit complaints to the Ombudsman has been high. The Ombudsman has published two reports, Tax Credits: Putting Things Right in June 2005 and Tax Credits: Getting It Wrong? in October 2007, which highlight some of the issues raised in the complaints received and make recommendations for changes in policy and practice.

Further information can be obtained from:

The Parliamentary and Health Service Ombudsman
Millbank Tower
Millbank
London SW1 4QP
Helpline: 0345 015 4033
Fax: 0300 061 4000
Email: phso.enquiries@ombudsman.org.uk
Website: www.ombudsman.org.uk

Remedies

The basic remedies which may be proposed at any stage of the process are:

• an apology from the Revenue
• an explanation of what went wrong. Where possible any mistake should be corrected so that the claimant is put in the same position as if the mistake had not been made
• payment of costs incurred because of any mistake or delay. Postage, telephone calls, travel expenses, financial charges and professional fees could be included here. Any claim for costs should be supported by receipts and invoices
• payments for worry and distress to the claimant – these typically range from £25 to £500 if a complaint is handled poorly or takes an unreasonable time to resolve
• an agreement not to recover overpayments of tax credits – where this is reasonably in line with Tax Credit Office guidance in COP26.

Further information and advice

CPAG in Scotland Tax Credits Project summary webpages

Child Poverty Action Group in Scotland
0141 552 0552 advice line for advisers on benefits and tax credits,
Monday, Tuesday, Wednesday and Thursday 10am to 12pm

Email: advice@cpagscotland.org.uk
email advice for advisers on benefits and tax credits

CPAG in Scotland’s advice line is only for advisers. If you are having problems with your own tax credit or benefit claim and are in need of advice you should contact your citizens advice bureau or other local welfare rights service.

HM Revenue and Customs
Tax Credit Helpline 0845 300 3900
(textphone 0845 300 3909)

Website: www.hmrc.gov.uk

© Child Poverty Action Group, April 2010
CPAG in Scotland’s Tax Credit Project is funded by the Scottish Government.

This fact sheet was last updated April 2010

Child Poverty Action Group is a charity registered in England and Wales (registration number 294841) and in Scotland (registration number SC039339). Company limited by guarantee registered in England (registration number 1993854). Registered office: 94 White Lion Street, London N1 9PF