HM Revenue & Customs (HMRC), the UK’s tax authority, is reviewing its decisions to halt child benefit payments for approximately 23,500 claimants. The decisions were initially based on travel data, which HMRC used to determine if claimants had permanently left the country.
Typically, child benefit ceases after an individual has resided outside the UK for more than eight weeks. However, numerous affected individuals have reported that HMRC suspended their payments after brief holiday trips.
This review follows demands for clarification from Members of Parliament on the Treasury Select Committee.
HMRC has issued an apology for any inaccuracies and encourages individuals who believe their benefits were wrongly terminated to contact them.
A government spokesperson stated: “We extend our sincere apologies to those whose payments were incorrectly suspended.”
“We have implemented immediate changes to the process, providing customers with a one-month response window before payments are suspended. We remain committed to safeguarding taxpayers’ funds and are confident that the majority of suspensions are accurate.”
In September, the government initiated a crackdown on child benefit fraud, estimating potential savings of £350 million over five years.
The new system cross-references HMRC records with international travel data from the Home Office. HMRC had utilized this data to suspend payments to thousands of families.
However, the authority is now reassessing all cases following a surge in complaints from individuals who claim their payments were stopped after short holidays and subsequent returns to the UK.
Eve Craven recounted to the BBC’s Money Box programme that, approximately 18 months after a five-day trip to New York with her son, she received notification that her child benefit had been terminated.
The letter cited her US trip and stated that there was no record of her return.
“I was given a month to provide all the requested information to prove that I’d returned to the UK,” she stated.
“It’s a significant burden to bear for a mistake they made and should have been able to resolve themselves.”
Eve’s child benefit has since been reinstated, with all missing payments backdated.
The issue initially surfaced in Northern Ireland, where some families had departed the UK from Belfast but returned via Dublin – within the EU – before driving home across the border.
Under the Common Travel Area agreement, UK and Irish citizens can move freely between the two countries.
As there are no routine passport checks along the Northern Ireland-Republic of Ireland border, the UK government lacks data indicating that individuals have returned to Northern Ireland.
The total number of errors and their causes remain unclear.
HMRC informed Money Box that it will review all past cases, “using PAYE data and where continued UK employment is found, will be reinstating payments and making any back payments necessary.”
The authority aims to complete the review by the end of next week.
The Treasury Select Committee is also conducting its own investigation.
Additional reporting by Nick Edser
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