Tax credit fraud

The Tax Credit Office takes the issue of tax credit fraud very seriously and aims to run a tax credits system that you can trust to support you.

On this page:

What the Tax Credit Office is doing to stop fraud
Types of fraud investigations
More useful links

What the Tax Credit Office is doing to stop fraud

The Tax Credit Office works hard to protect you and the system against the risk of fraud by:

regularly checking the details given on claim forms
checking with childcare providers that the details given are right
working closely with organisations like the Department for Work and Pensions, the Police, and the Immigration Service
working closely with the British Banking Association to find bank accounts that are being used for tax credit fraud

When they work with other organisations, they’ll make sure they comply with data protection laws.

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Types of fraud investigations

When the Tax Credit Office discovers a case of fraud they can:

charge a financial penalty
prosecute

There are two types of investigation they can use to deal with tax credit fraud:

civil investigations
criminal investigations

Civil investigations

The aim of a civil investigation is to get back any tax credits payments that have been falsely claimed through fraud, along with any interest. The Tax Credit Office will also charge a financial penalty. A civil investigation does not prosecute.

They’ll offer a person the chance to co-operate with them and tell them all the facts. This is known as making a full disclosure. To encourage someone to co-operate with them, they’ll consider lowering their penalty. The amount they’ll lower it by depends on why the penalty's being charged:

if it's for giving wrong information they’ll reduce it by up to 50 per cent
if it's for not telling them about a change in circumstances, the amount they’ll reduce it by depends on if it's the first time it's happened and the amounts involved

When the Tax Credit Office is sure the person responsible has told them all the facts about the fraud, they’ll work out how much the person has to pay .

Tax credit penalties

Criminal investigations

The Tax Credit Office tries to deal with tax credit fraud using civil investigations whenever possible. They’ll only use criminal investigations in very serious cases where:

they want to send a strong message to stop other people from trying the same thing
the person has acted in a way that makes a criminal investigation the only option

Serious cases include:

organised tax credit fraud
where false statements have been made
where fake documents have been given to the Tax Credit Office
where people claiming tax credit have hidden information from the Tax Credit Office or misled them on purpose
where someone's carried out the same type of offence before
where there's proof that Tax Credit Office staff have been assaulted or threatened
where people have pretended to be their employees

Tax credit fraud

What the Tax Credit Office is doing to stop fraud

Types of fraud investigations

Civil investigations

Criminal investigations

More useful links