In early January, HMRC had requested a set of very specific information from me – accounts, receipts, that kind of thing and I had sent them exactly what they asked for.  At the end of January, I went to check my bank balance one day, expecting to see my working tax credits and…nothing.  No working tax, and no child tax credits. I rang the office, expecting for there to have been an error of some kind, only to be told that I had failed their tests and that they would be taking my child tax credits – the money meant for my son – to repay the alleged debt that I owed them.

Devastated, I asked for further information but they could only tell me that the decision-maker’s word was final.  No advice, no word of where I had gone wrong, nothing.

Back in 2015, the rules changed for self-employed people claiming working tax credits and anyone that didn’t meet the new criteria would no longer be eligible.  I thought nothing of it, after all I worked regular hours, was profitable, and my business had a future.  Someone, somewhere, had decided otherwise, and nobody could tell me why.

Ten months later, I have won my appeal against their decision in a tribunal.  It has been tough, stressful, I have used food banks and borrowed money for bills, my son has gone without clubs and classes but we have won, just in time for Christmas.

I could not have done it without some key information, which is what I am going to share with you now, for if this abrupt removal of your lifeline happens to you.  It is cruel and inhumane what they are doing to us self employed people and if you are a) in a creative business and b) universal credit is coming to your area, you are at risk.

To avoid all of this, to exempt yourself from the profitability and commerciality test: 

• Register as a limited company.  As  company director you will be an employee not a self employed person so the new punitive rules no longer apply.  Be aware though: as a company director, your name and address will be available to the public.  This is a risky move for some people.  Do your research. Be safe.

Prior to your tax credits being stopped:

• If they ask you for a set of information, receipts etc., know that you are being assessed.
• Send what they ask for, plus: a business plan for the financial year in question, future financial forecasts for the year in question, flyers, business cards and a comprehensive explanation of your business.  They need to be reassured that you have four weeks’ work in the future to do.
• Send photocopies only, because I hear they lose a LOT of information that is sent to them.
• Send it all by special delivery, so that they cannot deny receiving it.  This will all cost quite a bit of money, but trust me, it is worth it.  Losing your documents is a common occurrence.

I can’t guarantee this will, help, but that is the kind of thing they look for.

If you wake up one morning and have no cash, if they have stopped your money:

• Ring and ask for a “mandatory reconsideration”.  You need to send them anything that you think might add to your case.  Tell them you can’t feed your kids and they need to start paying you your child tax credits back.
• Citizens Advice can help at this stage.
• IMPORTANT (because this takes a long time to come) put in a Freedom of Information Request asap. This is VITAL, they will not tell you the exact reason that your claim has been terminated, you will have to scour the information here and find out for yourself.  Within it is a score sheet. This will tell you more.  You won’t get this in time for your Mandatory Reconsideration, but you will do in time for your appeal.

If they turn down your Mandatory Reconsideration:

• Citizen’s advice cannot help you here, they are not qualified enough.  If you are lucky and live in the right place, see if you can find a Law Centre.  If like me you don’t have the right postcode to get “free” help, you have two options: pay for a solicitor, or, do it yourself.  As I had no cash for a solicitor, I took the latter.
• Begin your appeal straight away.  Revenue Benefits has loads of information about how to do this.
• TIME IS OF THE ESSENCE. You have a tiny window of time to appeal in and chances are any letters they send you will be dated several weeks before you receive them, so you have to work fast.  Don’t worry, you will have plenty of time to prepare your case – between three months to a year before your case is heard in the Tribunal court.
• Use this time to go through your FOI with a fine tooth comb to find out how they have marked you down on their score sheet and find evidence to disprove their (what are likely to be) assumptions.
• Back this up with evidence that you’ve been working hard in the meantime.
• Keep a time-sheet, make sure your accounts are kept up to date etc, because when they call you to court, you’ll have maybe two weeks notice.
• Make a formal complaint.  For me, this confirmed what I had discovered via the FOI, that they had marked me down for information that they hadn’t actually asked for! if you’d like an email address, ask me.
• Check case law.
• Try to find someone to go with you.  This availability varies drastically area to area, so you’ll have to do your own research here.
• Don’t give up.