DOZENS of families could be entitled to compensation from the Inland Revenue after being plunged into debt by the tax credit fiasco.

The Government launched the child tax credit and working tax credit means-tested benefits last month in a blaze of publicity targeting families on low incomes.

But the Evening News has been inundated with calls from disgruntled parents angry that they have not received their money because of bureaucratic delays and miscalculations.

In some cases, families have been forced to arrange bank overdrafts to cover their rent and childcare costs.

Now the Inland Revenue says families could be entitled to claim compensation for "reasonable costs" under its standard complaint procedure.

This paves the way for cash-strapped parents to reclaim the cost of arranging and maintaining a bank overdraft while they wait for their tax credit payment.

"Each case will be judged on its own merit and against what service people are entitled to expect," said David Prince, Inland Revenue spokesman.

"Where we haven't provided that service, we will look at what can be done to put it right."

Mr Prince would not discuss individual cases but Inland Revenue guidelines say compensation can range from £25 to £500 if someone has been caused "worry and distress".

The Inland Revenue says on its website: "If our actions have affected you particularly badly, please let us know.

"We may be able to pay an amount of compensation to acknowledge and apologise for the way we have treated you.

"These payments are not intended to put a value on the distress you have suffered."

Up to £500 is also available to cover the cost of travelling expenses, postage and phone calls, which will be welcome news to many parents who say they have bombarded the national tax credit helpline with calls which are charged at four pence per minute.

n Opinion: P6