Now, the point of this article, is the trouble with this system. HM Gov pays these payments in advance of the actual Tax year you are actually in. So, for example. We are in Aug 2010.
But, Tax system credits that would have actually been paid are the allowance for 2011/12. So, if you stop this merry go round, by getting yourself a job that is more than the cut off rates or fail to submit a claim.
You then end up with the Taxman demanding £2,500 overpayment. Which, is a tad rich, as you didn’t make up this lunatic system that is totally open to fraud. […]
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