HM Revenue and Customs (HMRC) has launched a review of historic records after discovering that thousands of taxpayers may be owed money due to errors in previous tax credit claims. The issue relates to those who previously received either Working Tax Credit or Child Tax Credit, benefits which have now been replaced by Universal Credit.
The department has identified that some claimants' records contain mistakes where an award notice was not issued despite entitlements, resulting in individuals being underpaid. HMRC is currently writing to those affected to inform them and provide guidance on how to claim any unpaid amounts.
Confusion arose as some individuals received letters referring to claims dating back as far as 20 years, prompting queries about the relevance and accuracy of the information. One claimant, who reached out via social media, questioned why correspondence related to a claim from the 2006/07 tax year was being sent without indicating whether an underpayment or overpayment existed.
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HMRC clarified that during the closure process of tax credits, discrepancies were found where some awards had incorrect finalised statuses and award notices were omitted. The department is rectifying these cases by issuing the missing finalised award notices. Importantly, if recipients confirm all information on the notice is accurate, no further action is required.
HMRC stated: “Tax credits ended on 5 April 2025 when customers migrated to Universal Credit. We are reviewing historic accounts and writing to any customers we identify with unresolved awards including unpaid tax credits, with instructions on how they can receive their payment.”
To date, HMRC has sent out approximately 170,000 letters as part of this ongoing investigation. Officials remain committed to identifying any additional claimants who may still be owed payments.
For further details, individuals are advised to consult the official government guidance available on the gov.uk website.
All tax credit claims have now been closed following their replacement by Universal Credit, which will fully supplant the previous benefits in the near future.