HMRC Launches Hotline and Scheme to Recover Covid-19 Fraudulent Payments

HMRC has established a new hotline to address fraudulent claims related to Covid-19 support programs. This includes benefits, loans, and grants that were obtained illegally during the pandemic. The tax office has created a dedicated website and phone number for individuals to report suspected fraud, allowing them to provide information about anyone they believe improperly received Covid-19 payments.

As part of this initiative, HMRC is offering a voluntary repayment scheme. This scheme allows individuals who received funds they were not entitled to, or did not need, to return the money without facing any penalties. The deadline for voluntary repayment is December 2025. However, those who fail to return the funds within this timeframe could face prosecution next year, when the government's new investigatory powers come into effect.

The voluntary repayment scheme covers all Covid-19 schemes, including loans, grants, social security, and tax benefits. The public can also report suspected fraud through the dedicated website. Reports can be submitted anonymously, and there are no personal or legal repercussions if no fraud is found. Individuals are advised to provide only information they already know and to avoid gathering further information or engaging with the individuals or organizations being reported.

The government's efforts to recover funds lost to Covid-19 fraud have faced scrutiny. In June, MPs expressed concerns about the recovery of nearly £2 billion in estimated taxpayer losses from the Covid bounce back loan scheme. The Public Accounts Committee criticized the lack of incentives for lenders to recover the money. The bounce back loan scheme, designed to support businesses during the pandemic, provided loans of up to £50,000 per business with minimal credit checks. The Department for Business and Trade estimates that losses due to fraud on this scheme will be at least £1.9 billion, with the actual figure likely to be higher.