Tax Dodger And Benefit Fraudster?

The Child Maintenance Service calculates a paying parents child support payment schedule using their income data from HMRC, and uses official information as much as possible.  This means that the income is historic, ie normally from the last previous full tax year, or the tax year prior to that.  This generally means that when a case is opened, CMS can use tax income data to make an assessment, meaning the paying parent does not have to provide proof of income.  

Taxable Income data is provided by HMRC.  Benefit data is provided by the Department for Work and Pensions (DWP).  This is provided automatically by those departments.

However there are some parents that still operate on a "cash in hand" basis in order to avoid paying taxes to HMRC.  This means that the government does not receive money to pay for vital services such as the NHS, Schools or the Armed Forces.  It also means that a parent is denied child maintenance and potentially a child suffers.  If someone is not declaring their income, HMRC are the body that this should be reported to, not CMS.  

Other parents may claim benefits whilst working in order to reduce CMS liability.  If they are working, but claiming benefits, DWP are the agency to contact.  

Al Capone the American untouchable gangster was not jailed for the extortion, or the smuggling or the murders that he was responsible for.  He was jailed for tax evasion.  

In the UK It's rare to be prosecuted or sent to prison for tax evasion, which is good for the receiving parent as the paying parent does not have to pay a penny whilst in prison!  

However HMRC are not a soft touch, and can take further enforcement action if someone fails to pay their taxes, or fails to make an agreement with them to pay it. 

HMRC will try other options, such as taking possessions, including vehicles, to sell at auction (called 'distraint').  This also means that once it is established there is a tax liability due to income, the CMS are able to obtain that figure and calculate maintenance.  In turn the CMS will also be able to take enforcement action.

You should never make a false report to an agency, as the penalties could be severe and it could be construed as harassment.  However if you know someone is trying to avoid their child support obligation or child maintenance by an illegal method, you can report as follows.

Report to HMRC that someone is avoiding tax

Are they doing jobs cash in hand?  Not declaring income

Report via this website:  Report-an-unregistered-trader-or-business

Report to HMRC that an employer is paying a parent cash in hand

An employer paying cash is not breaking the law, provided the person receiving, receives a payslip and the tax and NI are paid.  However some employers will pay cash in hand, to avoid paying employers National Insurance and forwarding the taxes.  It also means they dont have to provide a pension or paid holidays if the employee doesnt exist.

This is a clear breach of law, paying cash to avoid employer National Insurance, rips off the rest of us, that have to pay National Insurance.

More details can be found at

The HMRC Fraud Line Here.

Contact the HMRC Fraud hotline free on 0800 788 887

Report to a Local Authority

By virtue of claiming to be unemployed, some parents will therefore claim benefits from the local authority.  This sadly can mean that the CMS will accept that someone is not working as they are claiming benefits such as housing benefit.  This should be reported to your local council.  If the council are paying a landlord direct, that will mean that the payments will stop, and the parent may have to pay any arrears direct to the landlord or be evicted.

Report Benefit Fraud

If someone is claiming to not work, but also claiming universal credit you can report that to the DWP via the National Benefit Fraud Hotline

Contact: 0800 854 440

Textphone: 0800 328 0512

Or write to them at: 
National Benefit Fraud Hotline
Mail Handling Site A
Wolverhampton
WV98 2BP

If a paying parent cannot account for their earnings, they may be earning money through criminal activity.  You can also try asking the CMS to raise a Criminal Activity Report internally.  

If you are a paying parent, and the issue involves child benefit, please see the post at https://childmaintenancehelp.blogspot.com/2020/08/how-to-report-child-benefit-fraud.html

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