The UK tax office, HM Revenue & Customs (HMRC), has faced scrutiny from a group of MPs regarding its handling of child benefit payments. The Treasury Select Committee reported that HMRC mistakenly ceased payments to thousands of claimants based on the incorrect assumption that they had permanently moved out of the UK. This decision followed HMRC’s choice to stop cross-checking travel records with tax data to verify claimants’ residency status.
The chair of the committee, Dame Meg Hillier, described the cessation of these checks as a “costly error.” In response, HMRC chief executive John-Paul Marks issued an apology and stated that the agency is implementing changes to enhance its verification processes, including reinstating employment checks. By the end of October, it was confirmed that over 3,600 individuals, approximately 15% of those flagged as potentially ineligible due to travel history, remained qualified for child benefit.
In September, HMRC initiated an effort to combat child benefit fraud, which the agency estimates could lead to savings of £350 million over five years. The child benefit program currently provides support to 6.9 million families, but eligibility ceases after eight weeks of residing outside the UK. Many affected claimants reported having their payments halted after brief travels, with some claims being incorrectly flagged due to evidence of their departure without confirmed return.
The HMRC’s pilot program utilized data from the Home Office related to passengers leaving the UK, alongside tax information, to monitor claimants’ residency. However, Marks noted that the additional cross-checks against tax and payroll data were discontinued to streamline procedures.
To address these issues, HMRC plans to allow claimants at least one month to provide proof of eligibility in cases where travel data suggests they may no longer be in the UK, ensuring that payments will not be paused during investigations. MPs intend to further question HMRC in the coming year about the lessons learned from this situation.
Source: https://www.bbc.com/news/articles/c4gj1gq9zzyo?at_medium=RSS&at_campaign=rss