Taxis an important instrument of governmental power that has considerable implications for socio-economic inequalities and justice. Although the depth and broadness of critical tax research in accounting literature have developed recently, there remains more work to deepen our understanding of tax. Tax is a process of regulating individuals and society and relies on accounting technologies to regulate the behaviour of individuals. In this spirit, this paper provides a nuanced understanding of the hidden powers of accounting technologies within tax administration by examining the administration of the UK Tax Credits (TC)system. Our aim is to understand the role accounting plays when claimants manage their TC obligations in everyday practice and consequences for their socio-economic position. This paper also gives voice to those targeted and affected by accounting technologies by examining their lived experiences in their own words, through unstructured interviews, observations and participatory fieldwork. The TC system administered by Her Majesty’s Revenue and Customs (HMRC)is a prime example of governmental power and unintended consequences of tax administration. The TC system was introduced in April 2003 as part of New Labour’s government strategy of reducing child poverty and encouraging individuals to work. However, during its early years in operation, up to one-third of claimants suffered overpayments and were forced to repay hundreds and thousands of pounds to HMRC. The TC system, contrary to its aims, reinforced and worsened financial hardship for a significant proportion of claimants. Especially those on low-incomes and in positions of socio-economic disadvantage. Thus, the TC system is an interesting government programme to examine and address the long-standing question of how some government programmes fail to achieve their intended outcomes for some users. This paper does not seek to find out the cause of overpayments; rather it focusses on what happens after claimants find out about their overpayments and how and why their encounters with accounting technologies affect their financial outcomes. Increasing our understanding of the relational relationship between citizens and the state asks for careful empirical research into how various actors decide, engage and negotiate with each other and various technologies in everyday practice. Bringing critical social theory to bear on these complex and emergent dynamics enables us to explicate relationships of power and evaluate implications for social equity and justice. In this light, this paper draws on Bourdieu’s social theory of capital, habitus and field to explain how tax administration can operate as a form of relational power that creates and maintains socio-economic inequality. We demonstrate how the TC system sustains socio-economic inequality between claimants depending on their economic, social and emotional capital for becoming self-responsible. Those able to utilise and increase their capital end up financially better off, whilst those most disadvantaged are locked into a position that increases their financial and emotional hardship. In contrast to top-down understandings of governmental power, an important contribution of this paper is that it demonstrates and conceptualises how socio-economic inequalities are created through gradual relational power dynamics during everyday practice. This paper contributes to the growing body of critical accounting literature by approaching the TC field as a site of social struggle and highlights that the power of accounting is not merely technical but is relational. We demonstrate how accounting technologies responsibilise individuals through relational practices; and also highlights issues of social inequality by demonstrating how accounting technologies inhibit some individuals from being responsibilised, worsening their financial hardship. Keywords: Tax Credits; Accounting Technologies; Grounded Theory; Ethnography; Bourdieu; Governmentality