Tax Credit Overpayments Help & Discuss

I am no longer entitled to child tax creditd and still get them I have written, phoned the Inland Revenue constantly since August and they tell me that their computer will not adjust until March - well we'll see but I will be entitled again in June so this is going to be interesting. Oh and my overpayments are stored in a bank account earning me interest. Mind you it is only £40.00 per month!!!

My sister was overpaid by a horrendous amount and she has five children. The result is that this year her and her family are struggling to make ends meet.

I hate the Tax Credits system! Quite apart from all the incompetence, I think it's dreadful that you have to claim to get it. People who are entitled to tax back because they have children shouldn't have to go through the whole complicated process of making a claim - it should be paid automatically through their tax code. There will always be people who don't claim, either because they aren't aware they can claim, are intimidated by the system, or who simply don't get round to it. This is obviously the reason the Government changed the system in the first place, because they knew it would save them money in unclaimed credits. What a surprise! :rolleyes:

I didn't have trouble with overpayment, but it DID take about 9 months to get the proper Tax Credits Award Notice sent out to me, despite repeated phone calls, letters, etc. I needed it for proof of entitlement to free school meals, and the fact they sent me out the wrong notice 5 TIMES caused me a lot of inconvenience with my children's school.

Actually, the worse thing about Tax Credits was the pressure put on you to apply. "Don't miss out!" the advertisements urged. So, like a good girl, I applied, because I didn't want to miss out, did I?

It wasn't until I was actually receiving Child Tax Credit, that I discovered what a trap I'd fallen into. I have a son with a Learning Disability, for whom I receive Carer's Allowance, and this used to mean I was entitled to Income Support, as I am a single parent and don't work because I need to look after my son. However, once I was receiving Child Tax Credit, I was told by the Benefits Office that I could no longer get Income Support as I was earning too much money, (£19 a week more than before, apparently).

This doesn't sound too bad at first, until you realise that once you are off IS you no longer automatically qualify to have most (or all) of your rent paid in the form of Housing Benefit. I'm sorry, said the lady from the Council, we have to assess your income as though you are working now. Because I get Invalid Care Allowance for my son, which now counted as income, I couldn't get as much Housing Benefit, and I was also presented with a whopping Council Tax bill as well, which I ended up paying a court charge on because none of the various Council departments knowing what any of the others were doing.

Fine, I said, I'm obviously worse off now overall than before I applied for Tax Credits, so at the end of the tax year, I'll ask them to take me off and go back on Income Support, then at least I'll get proper Housing Benefit again.

WRONG! Once you are receiving Tax Credits you cannot stop receiving them. Apparently, this is AGAINST THE LAW! It would have been nice to have been told this at the same time as all the 'don't miss out' hype. :mad:

As a consequence, we struggled rather more than usual for about 9-12 months, and then suddenly, out of the blue, my Housing Benefit went back up and I had a rebate on my Council Tax, cancelling out the extra amount I'd been obliged to pay. I never did find out exactly what happened, and frankly I was more than a little worried about them taking it away again, so I didn't investigate too closely. So I did get the money back eventually, in the form of a big cheque from HB and a credit on the Council Tax, but it was a lot of grief I felt I shouldn't have had to go through.

There are obviously a lot of circumstances where you ARE definitely better off claiming than not claiming Tax Credits, but I would urge everybody to really go into it as much as they can, and assess all knock-on effects BEFORE applying, as once you are receiving the Tax Credits, you cannot de-register.

There is also a rather complicated tier system of payments, depending on how much money you and your partner earn, and oddly enough, the highest level of credits are paid to those who are somewhere in the middle. If your income is below a certain level and you work in a job where your hours are negotiable, pay close attention to the figures for this middle band of earnings. It would be silly to work half an hour more a week and be financially worse off!

Thanks for this thread. We've had nothing but problems this year with our TC claim. Granted we have moved house and my other-half has started a better paid job but they can't seem to decide how much we have been overpaid. I got so fed up with it (and with knowing that the annual review is due very soon as it is nearly the end of the financial year) that I created an Excel spreadsheet to work out where exactly we are supposed to be with our tax credits and to make sure that their figures add up - WHICH THEY DON'T. I personally would suggest that you check your award notices closely with a calculator. Our awards go like this :

11th May 04 : Owe them NOTHING
17th May 04 : Owe them £27.52 "to be collected from future years" AND £143.96 "owed from previous years"
13th July 04 : Owe them £29.79 "to be collected from future years" AND £136.99 "owed from previous years" Less £6.97 "amount we have paid that they have set against overpayments in other award periods"
NOTE : My partner started his new job September 1st with a £8000 pay increase
27th September 04 : Owe them £0.54 "to be collected from future years" AND £107.79 "owed from previous years" Less £36.17 "amount we have paid that they have set against overpayments in other award periods"
10th November 04 : Owe them £137.79 "to be collected from future years" AND £22.67 "owed from previous years" Less £121.29 "amount we have paid that they have set against overpayments in other award periods" - "Amount you have to pay back" £771.59
21st December 04 : Owe them £88.62 "to be collected from future years" AND £81.14 "owed from previous years" Less £62.82 "amount we have paid that they have set against overpayments in other award periods" - "Amount you have to pay back" £823.16

As a result of all this messing about they stopped MY Child Tax Credit at £40 a week on the 5th November to pay back my partners overpayment of Working Tax Credit. It was this option or they reduced our money over the whole of the next financial year, so no money for 6 months was the lesser of 2 evils IMHO due to loan repayments etc this year. By my calculations though, we will still owe them £51 when they should resume paying me on the 8th April 05. Best thing is that at one point they were actually going to be underpaying us by £143 over the year according to their figures. I can't wait for the next award notice to come through. I haven't complained to an authoritive *haha* body for quite a while *grin*

I am stunned, I have to say I thought it was just my wife and I who had problems, but it does seem endemic. I'll not go into the whole saga as its similar to many others. Suffice it to say one small change 2 years ago is still haunting us, it has COST us in underpayments around £200 and they're still claiming an overpayment of £300. All down to a missing letter \ wrongly input details (obviously then followed up by 1.5 years of staggeringly inaccurate and conflicting advice)

When you talk it through with the staff they're helpful and see the sense on what you're saying but say their hands are tied.

Am appealing at the moment, but it's goot to know there's others in the same boat.

The fustrating thing about the whole affair is the COMPLETE lack of clarity in either the information sent or the info you get when you call. I've called the helpline 5+ times only to be told to ignore the letter sent as it's wrong. What is the problem with the tax credits being included on something like a statement. Banks, Credit cards, council tax, even some wages use them, it works, why keep sending us "snapshots" of whats going on at the point the letter is sent...

I can rant about this for ever.....