Tax Credits

Work and Pensions written question – answered on 14th June 2005.

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Photo of Danny Alexander Danny Alexander Shadow Spokesperson (Work and Pensions)

To ask the Secretary of State for Work and Pensions what estimate he has made of the number of housing benefit and council tax benefit claims that will need to be reassessed as a result of overpayments of tax credits in the last 12 months; what assessment he has made of the cost implications for local authorities; and if he will make a statement.

Photo of James Plaskitt James Plaskitt Parliamentary Under-Secretary, Department for Work and Pensions

holding answer 13 June 2005

No housing benefit or council tax benefit assessments need to be revisited solely because of an incorrect tax credit award. Both housing benefit and council tax benefit take into account the actual amount of tax credit in payment at the time. This means that when someone is getting a higher amount of tax credit than they are due, they will receive less housing benefit or council tax benefit. However, when the tax credit is reduced on account of an earlier overpayment, the individual will receive a higher amount of housing benefit or council tax benefit.

This is easier for local authorities to administer and means that individuals receive, overall, the right amount of money. There should be no cost implications to local authorities.

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