Taxman fails to tip off social welfare on lone parent frauds
Published 05/12/2011 | 05:00
THE taxman has failed to give social welfare bosses the names of more than 6,000 people who were caught fraudulently claiming the one-parent tax credit.
The lapse means that thousands could still be claiming lone-parent welfare allowances to which they are not entitled -- even as the Government is expected to slash the social welfare budget today.
Child benefit of €167 for a third child and €177 for fourth and subsequent children are to be cut to €140, although payments of €140 per month for the first and second child are likely to remain untouched.
The "one-parent family" tax credit is worth €1,650 per year on top of the normal personal tax credit -- but only people who are neither married or not living together are entitled to claim it.
A list of individuals caught wrongly claiming a one-parent tax credit has not been sent to -- nor requested by -- the Department of Social Protection.
The department is paying out €1.1bn in lone-parent allowance each year -- worth €188 per week, plus €29.80 for each additional child.
The revelation comes after an admission by Social Protection Minister Joan Burton that information technology systems in her department and in the Revenue were not very good at "talking to each other".
The Revenue department has been carrying out regular checks to catch people abusing the "one-parent family" tax credit since 1997.
But it did its most extensive trawl ever earlier this year -- monitoring 18,000 people between January and August.
Problems were found in 6,400 claims -- some were found to be living with a partner, while others were claiming for children aged over 18, which is not allowed unless the child is still in full-time education.
After the trawl, officials reduced tax credit claimed by 5,070 of those and removed it altogether for 1,339 people.
They also collected €1.33m in taxes, interest and penalties for fraudulent claims.
A spokesman for the Revenue said internal discussions were still taking place about what information should be shared with the department and how this should be done.
There was no sense of urgency either from the Department of Social Welfare, which said it was "likely" the information would be requested, but did not say when.
In addition, separated or unmarried fathers who refuse to pay child maintenance are still legally entitled to claim the tax credit.
Single men or widowers account for around 34,000 of the 100,000 people who claimed the tax credit last year.
Of almost 43,000 cases investigated since 2008, the Department of Social Protection discovered 24,000 separated or unmarried fathers who were not making child support payments for various reasons.
But the Revenue confirmed it did not get details of these non-paying fathers from the department so that they could be cut off.
The one-parent tax credit was cut from €1,830 to €1,650 in last year's Budget.