A taxing situation for working families

ALLIANCE East Belfast MLA and Councillor, Naomi Long, has said that offers of a ‘hardship payment’ to people who have fallen foul of a overpayments by the Inland Revenue are adding insult to injury.

People receiving the Working Family Tax Credit who have been overpaid are having to pay the money back, even though they may not be able to do so easily.

Councillor Long stated:

“The Inland Revenue have admitted that the overpayment mistakes are their fault, but the families affected are the ones paying the price. They are telling those they have overpaid that they should have realised. However, since they don’t show people how the tax credit is calculated when they are assessed, this is just nonsense.

“People who spent the money in good faith, completely unaware the Revenue had made such a massive blunder, just don’t have the money to pay it back.

“The Revenue has set the levels of repayment pretty much on their own on their own terms. The families have no real negotiating power as the money can simply be deducted from their payments. As a result, the families are now living on significantly less than the monthly income which the Government has told them they actually need to manage their family.

“When I raised the issue on behalf of constituents I was told that if the families were suffering hardship they could apply for a ‘hardship payment’. They then explained that these payments are actually loans which would have to be repaid over 12 months out of their tax credit in the same way as the original overpayments have been.

“Rather than helping families they are simply extending the misery and hardship for another 12 months. What purpose is served by encouraging people into even more debt? This is a disaster for families at a time when they have had additional expenses for school uniforms and books and in the run-up to Christmas, and it looks like ordinary people are still going to be paying for the Inland Revenue’s arrogance long into 2005.”

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