What Do Tax Credits Check Your Bank Statement For?
By
HuutiMoney
If you are a Tax Credits claimant who has been asked to declare their bank statement to the DWP, you will be interested in the following blog post that aims to answer the question of what Tax Credits check your bank statement for. For a holistic view, we will also discuss the concept and consequences of being convicted of Tax Credit fraud.
What Do Tax Credits Check Your Bank Statement For?
If your bank statement is being checked by the DWP as part of your Tax Credits claims, there can be two main reasons:
- the DWP wants to know if you have been overpaid Tax Credits by the authorities
- the authorities want to confirm that you have correctly stated your income
Although it is not a common practice for Tax Credits claimants to have their bank statements checked by the DWP, however, if the authorities have reason to believe that a claimant has declared their financial information with false information; whether on purpose or inadvertently, they can check bank statements to confirm the facts.
Sometimes, the DWP receives information from third parties that indicates a potential claim fraud; due to which the authorities need to confirm this information by checking the bank statement of the claimant(s) against whom the information has been gained.
Tax Credits are intended for individuals on a low income. This means that their earnings (whether through employment, self-employment, benefits, pension or a combination of these) should be below £16,000 so that they remain eligible for Tax Credits.
If the DWP is suspicious that a claimant’s income or savings are more than £16,000, they can check their bank statements to confirm.
Can The DWP Check Any Other Documents Other Than Bank Statements?
Yes, if the DWP does not find sufficient information through bank statements, they can also check other personal and financial documents. These include the following:
- building society or Post Office books or statements
- investment and share certificates
- a professional property valuation (other than the property you live in)
- National Savings Certificates
- annuity or trust fund documents
- Premium Bonds
What Is A Tax Credits Fraud?
Tax Credit fraud is known to have taken place in the case of any of the following situations:
- The claimant has made an erroneous false representation of facts to claim Tax Credits. This means that have declared an incorrect amount of income without intention.
- The claimant has made a deliberate dishonest representation of facts to claim Tax Credits. In this case, there is evidence to prove that the climate has made a false declaration to be on a low income on purpose.
- The claimant has not informed the DWP of a change in circumstances with affects their Tax Credits claim. This means that there has been a change of circumstances that the claimant has failed to report just to claim Tax Credits.
What Happens If You Are Convicted Of Fraud To Claim Tax Credits?
If the DWP has evidence that proves that a claimant has deliberately hidden information or presented false information to claim Tax Credits, the claimant will be convicted of fraud. Even if the DWP does not have evidence (yet) and is suspicious about a claimant’s financial situation, they can request an investigation to convict them.
If a claimant is convicted of Tax Credit fraud, the most likely consequences include the following
- told to pay back the overpaid money
- be taken to court
- asked to pay a penalty (between £350 and £5,000)
One must keep in mind that fraud of this type is a criminal offence. This is the reason why claimants can be taken to court in such cases.
Conclusion:
The above discussion helps to conclude that if your bank statement is being checked by the DWP for your Tax Credits claim, there is a possibility that you are being investigated for claim fraud.