§ Dr. Lynne JonesTo ask the Chancellor of the Exchequer what estimate he has made of the level of fraudulent claims as a result of the replacement of family credit with Working Families Tax Credit. [113297]
§ Dawn PrimaroloReliable estimates are not yet available.
§ Dr. Lynne JonesTo ask the Chancellor of the Exchequer what measures he has taken to prevent fraudulent claims for working families tax credit. [113298]
§ Dawn PrimaroloThe Tax Credits Act 1999, and the regulations made under that Act, provide the Inland Revenue with effective powers to make inquiries into applications. Where fraud is discovered, the Act provides for financial penalties to be charged, based on the amount fraudulently claimed. In the most serious cases, a criminal prosecution may be brought. The application form warns prospective applicants of the consequences of making a fraudulent claim.
The Inland Revenue use risk assessment procedures to target their inquiries on the applications most likely to be fraudulent, and where the largest amounts are at stake.
§ Mrs. FyfeTo ask the Chancellor of the Exchequer if the annual household income for the purposes of calculating working families tax credit includes child benefit to which the family is entitled. [114486]
§ Dawn Primarolo[holding answer 14 March 2000]: No, child benefit is wholly disregarded in calculating entitlement to the working families tax credit.
§ Mrs. FyfeTo ask the Chancellor of the Exchequer if the £200 a week minimum income received by families on working families tax credit includes child benefit. [114485]
§ Dawn Primarolo[holding answer 14 March 2000]: Yes, it includes child benefit and working families tax credit as well as earnings net of tax and National Insurance.
§ Mrs. FyfeTo ask the Chancellor of the Exchequer what guidance he will issue to the Inland Revenue to ensure that working families tax credit is(a) paid in full and on time and (b) takes account of the amount owed when an employee claiming working families tax credit leaves their job. [114481]
§ Dawn Primarolo[holding answer 14 March 2000]: From April, when tax credits start to be paid by employers through the payroll, the Inland Revenue will continue to assess awards. They will tell employers exactly when they have to start paying tax credit, when to stop, and how much to pay per calendar day (the daily rate) in each pay period during which they are responsible for paying tax 183W credit. The start notification sent to the employer includes a table showing 1–31 multiples of the daily rate to take account of different pay periods.
If an employee leaves his/her job before the end of the tax credit award, the employer will have to stop paying tax credit and issue the employee with a Certificate of Payments, showing the date up to which tax credit has been paid. The employee will send this to the Inland Revenue's Tax Credit Office, who will resume direct payments of tax credit to the employee.
Full guidance has been issued to both Inland Revenue staff and employers on these arrangements, which will ensure that employees receive the correct amount of tax credit throughout their 26-week award.
§ Mrs. FyfeTo ask the Chancellor of the Exchequer if he will estimate the additional amount per week that would be received by a family entitled to working families tax credit, for(a) one, (b) two and (c) three children, when the family's annual income is £10,400 and (i) there are no child care costs and (ii) the parental contribution to child care costs per week is (1) £10, (2) £20, (3) £30, (4) £40 and (5) £45. [114478]
§ Dawn Primarolo[holding answer 14 March 2000]: For such families with £10,400 gross income, and for 1999–2000, the value of the Working Families Tax Credit exceeds that of Family Credit by following amounts per week:
£ Total child care costs per week None £10 £20 £30 £40 £45 1 child 25.34 27.44 29.54 31.64 33.74 34.79 2 children 30.04 32.14 34.24 36.34 38.44 39.49 3 children 34.74 36.84 38.94 41.04 43.14 44.19 Note:
Figures based on a full-time worker with all children under 11 using eligible child care
§ Mrs. FyfeTo ask the Chancellor of the Exchequer if small businesses will be reimbursed promptly in respect of payments made by them as a result of handling working families tax credit; and if he will make a statement. [114479]
§ Dawn Primarolo[holding answer 14 March 2000]: Employers will be able to set tax credits paid to their employees against the PAYE income tax and National Insurance contributions and student loan deductions which they are due to pay to the Inland Revenue. Employers who think that they will have to pay out more in tax credits than they will deduct in PAYE income tax and National Insurance contributions and student loan deductions will be able to apply to the Inland Revenue for additional advance funding. They can apply up to six months in advance and do not have to wait until they have actually paid the tax credit.
Payment of WFTC through the pay packet is central to demonstrating the rewards of work and making work pay for families on low incomes. The Inland Revenue has been providing an extensive range of direct practical help and support for employers, including a dedicated telephone helpline for employers and a range of literature and face to face workshops which are particularly aimed at small businesses. Every employer received a copy of the Inland Revenue's "Employer's Guide To Tax Credits".