HMRC is currently reassessing the suspension of approximately 23,500 Child Benefit claims. Normally, Child Benefit is halted if an individual goes on vacation for more than eight weeks, but some recipients claim their benefits were mistakenly terminated.
In an effort to combat fraud, HMRC implemented a pilot program that utilized travel data to determine if individuals had permanently left the country. Unfortunately, some people were mistakenly flagged as not having returned from overseas trips.
Acknowledging the error, the tax office issued an apology to those affected by the incorrect suspensions. HMRC intends to conclude its review by the following week, reinstating claims and making necessary retroactive payments.
Although the pilot program reportedly saved HMRC £17 million, a significant percentage of families, as reported by The Guardian, were erroneously targeted for suspected fraud.
In Northern Ireland, a high rate of 72% of cases were misidentified as not returning from trips abroad, with only a small fraction of flagged families actually having left the country during the pilot phase.
HMRC has since updated its procedures to allow individuals a month to respond before benefit payments are cut off. A spokesperson for HMRC expressed regret for the mishandled suspensions and assured that the majority of suspensions are accurate.
Child Benefit, a support received by over seven million families, provides £26.05 weekly for the first child and £17.25 for each additional child. Eligibility for Child Benefit extends to individuals responsible for children under 16 years old, or under 20 if they are in approved education or training.
To qualify for payments, the child typically must reside with the claimant or have their care costs covered to a similar amount as Child Benefit. High-income earners may be subject to the High Income Child Benefit Charge, requiring repayment if earning over £60,000, with a full refund at earnings exceeding £80,000.
Individuals can settle the high-income charge through self-assessment or via their PAYE tax code.