Compliance issues for tax credits

Produced by a Tolley Personal Tax expert

Personal Tax

Guidance

This guidance note looks at the risks of mistakes and errors in tax credit claims and HMRC’s compliance approach. It also reviews penalty provisions and when these may apply.

Migration of tax credits to universal credit

New claims for tax credits are no longer possible as they have been replaced by the universal Credit for all claimants. Existing claimants will continue to receive tax credits until they are migrated to the universal credit system. Migration will take place when a change in circumstances is reported or when a migration notice letter is received. This is expected to be completed during 2024. There is information about migration notice letters on the GOV.UK website.

See the Universal credit guidance note.

Complexity of tax credits and risk of fraud

This guidance note explains the compliance issues to be aware of in relation to an individual’s tax credit affairs.

The Recovery of overpaid tax credits guidance note should be read in conjunction with this note.

Tax credits are extremely complex, and claimants often make mistakes in their claims.

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