Parents are also being contacted by the Inland Revenue, requesting details of their nursery fees and utility bills, mortgage and bank statements for the past three years.
Recently a parent has been left distressed by an Inland Revenue investigation. She was asked how much money per week she spends on her hair, how frequently she visits the cinema, what her monthly food bills are and whether she gives her child pocket money, and was quizzed about holidays. She has to prove that her partner moved out, where he was and when he moved back. There is a Pounds 500 penalty if she cannot do this in a week.
The investigators estimated that she had been overpaid by 5,000 in two years. Her tax credits stop with immediate effect and she has to pay the money back at 50 per week. She is therefore 100 per week worse off. She works nights but can no longer afford for her child to attend nursery three days a week. She has cut this to one day and will sleep after shifts when she can - not a safe situation for her or the child.
Another parent recently split up from her partner not long after filing her claim. She immediately informed the Inland Revenue and was interviewed and asked where she bought nappies. She felt intimidated and would not have proceeded with the claim if she could have managed without the money.
I was under the impression that the tax credits were means-tested and not dependent on how many cinema visits a person makes or where they buy their nappies. This is a worrying trend and likely to put people off from claiming, depriving these parents of the money they need.
While these parents are being intimidated, there are still cases of other parents claiming the money, not paying their fees and moving on to other nurseries to do exactly the same thing, with no penalty at all.
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