UK Tax Credit Compensation Averages £70

by Robert Lee, Tax-News.com, London

04 August 2003

According to a report by BBC News Online, the UK's Inland Revenue is paying out on average £70 in compensation to those affected by the severe delays in tax credit payments.

As of last week, a mere 20 people had received compensation from the Revenue, though officials said that a further 400 payments were in the process of being made. In total, some 13,000 complaints were received by the IR in response to the delays in tax credit payments that have resulted from its overloaded administrative system. The complaints have created a further backlog for the department which is having on take on extra staff to cope with the thousands of cases.

However, Revenue officials have sought to play down the number of complaints. "It sounds like an awful lot of complaints but there are 5.8m tax credits in payment at the moment, and 13,000 is only a tiny percentage," a spokesman told the BBC.

The Revenue estimated that of the 13,000 brought to its attention so far, around 5,600 would likely be granted compensation. At present, it said cases where no tax credits have been paid are getting priority treatment. It also revealed that some cases may take days to resolve.

The standard procedure is for a complainant to first approach the Inland Revenue, which then decides to proceed or reject the compensation claim. However, if someone complains through a Member of Parliament, cases are automatically investigated.

Recommended