UK tax authorities accepted a tolerable risk of harm when they stopped child benefit payments without warning during an anti-fraud crackdown, internal documents have revealed.
HM Revenue and Customs (HMRC) suspended nearly 24,000 child benefit claims between July and October after using Home Office travel data to identify parents it believed had left the UK.
However, later checks showed that at least 63% of those affected were still living in the country and entitled to the payments.
By the end of November, almost 15,000 families had been confirmed as legitimate claimants, while just over 1,000 cases involved incorrect claims. Thousands of cases remain unresolved.
Freedom of information documents show HMRC was aware that Home Office data could wrongly flag people as having emigrated but judged the risk as remote and acceptable.
This was despite a pilot scheme indicating travel data was inaccurate in nearly half of cases. During the full rollout, additional checks, including PAYE records, were removed to speed up the process, leading to widespread errors.
Parents reported severe stress and financial difficulty after payments were suddenly stopped. Some were wrongly flagged after travelling for funerals, medical emergencies or cancelled holidays, while others were recorded as emigrated despite never leaving the UK.
Officials believed any harm would be minimal and could be corrected through appeals. Critics argue this underestimated the real impact on families. Civil liberties groups said the data protection assessment was poorly handled and failed to properly consider risks to claimants.
Following public criticism, HMRC said it has changed its approach. It now cross-checks data and contacts parents before suspending payments, giving them time to confirm their eligibility.
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