HMRC warns 7,000 benefit claimants could have their payments frozen in two weeks

HMRC has warned that 7,000 benefit claimants have just two weeks to update their details or risk having their payments frozen.

Applicants whose money is paid into a postal account will need to set up a new payment method as soon as possible. They have until April 5, 2022 to make the required changes, reports The Mirror.

HMRC has warned that your benefits could be temporarily blocked if you do not update your payment account by this date. This includes benefit payments such as tax credits, child allowance or guardian’s allowance. Around 6,800 people who receive HMRC benefits have yet to close their postcard accounts before the deadline.

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Myrtle Lloyd, chief executive of client services at HMRC, said: ‘Time is running out and we want to make sure no client misses the benefit payments to which they are entitled. If you still need to change your postcard account, contact HMRC to update your bank account details.

HMRC has been writing to affected customers since October 2019 advising them that their postcard accounts will be closed and urging them to take action. More than 143,000 customers have already switched accounts and provided HMRC with updated details. Customers can choose to receive their HMRC benefit payments to a bank, building society or credit union account.

Postcard accounts are also closed for those receiving Department for Work and Pensions (DWP) benefits, but those affected by the change have more time to redirect their payments. These individuals will need to set up an alternate payment method to continue receiving Universal Credit, State Pension, or other DWP benefits by November 30, 2022.

What should I do next?

If you already have another bank account, you can contact HMRC or the DWP to let them know your new details. Your benefits will then be paid into this account instead of your postcard account.

If you need to set up a new bank account, you must notify HMRC or the DWP of your new details as soon as your new account is operational. For those claiming DWP benefits and not wishing to open a bank account, you will be able to use the payment exception service.

The Payment Exception service allows people who do not have a bank account to access benefit payments via the PayPoint network. Either method must be presented at a PayPoint outlet, which can be found in stores and newsagents, in order to access your benefits.

If you do not update the DWP with your new information by next November, you will automatically be transferred to the payment exception service. HMRC says it will suspend benefit payments if claimants do not provide new bank account details by the end of November. The date you are paid and the amount you receive will not change.

The Payment Exception service is for DWP benefit claimants only and is not available to those receiving HMRC benefits.

How do I update my contact details?

You can update your personal tax account or your family allowance account online at Gov.uk or by calling 0300 200 3100.

Anyone benefiting from tax credits can change their account details online via Gov.uk by calling the tax credit hotline on 0345 300 3900.

For DWP payments you can call 0800 0857 133 to update your details.

For the hearing impaired, you can contact the DWP via the free Typetalk service on 0800 0857 146.

Alternatively, the DWP should have mailed you a form which you can complete with your new account details and return.

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