Child Tax Credit Help please.

Clutterfree

Hi,
I receive 2 overpayment letters at the weekend - 1 for £200ish for 2005/2006 and the second for £400ish for 2006/2007.

Now hubby is self employed so we always have to estimate income and back in 2005/6 (I think!) he had a very good year (way over our estimate) so we had been overpaid CTC.
Since we informed them of the actual figure in 2006 we have received NO CTC payments since Aug 2006 as all our future payments have been used to pay off the overpayment.
We had no problems with this as there was nothing we could do to avoid it.
Anyway, Feb 2010 they restarted our CTC at £11ish per week.
I thought that meant we must have finally repaid what we owed.

Then we get the above 2 letters at the weekend????

I cannot understand why they have started making payments to me again if we still owed £600? They have given me a month to pay the £600.
I have tried calling them but no luck - in a queue, busy, etc but all costing me for the calls.

I've decided to write to them instead but not sure which address to write to.
My overpayment letter has a Glasgow address but my award letter has a Lancs address.
I want to know why they restarted payments if we still owe money and why can we not continue to pay from our future awards as we had previously instead of paying this lump sum and then they pay me £11 a week.
Could anyone tell me where I should send my letter please?

Thanks for reading.

sinstar

Overpayments are recovered at a set percentage of your entitlement, 100% of your entitlement will be recovered if you are only entitled to the basic family element of £10.50 p/w. If your entitlement has increased you can start getting payments but have 10% (if you're getting the maximum award) or 50% of your entitlement go towards your overpayment. So this might be why you are getting payments now but still have outstanding overpayment.

If you are receiving letters asking you to repay the overpayment directly it would mean that it is from a separate claim to the one you have open at the moment.

Here is a very helpful leaflet about tax credits, it shows their responsibilities and yours (which can be helpful if you want something to refer to if you want to point out they haven't met theirs) it also shows common scenarios that can cause overpayments.

http://www.hmrc.gov.uk/leaflets/cop26.pdf

Here is a link to a tax credits overpayment dispute form, filling in this official form is better than writing a letter also it has an address on it to send it to so you know your dispute will definitely be going to the right department:

http://www.hmrc.gov.uk/forms/tc846.pdf

sinstar

I just re-read your post, I see you have been given a month to repay this means the overpayment is in direct recovery which means it isn't from your current claim (the one you're getting payments from). They can't recover this from a separate claim ie. your current entitlement.

If you feel the overpayment was caused by an error they made and you shouldn't have to repay it, dispute it.

If you accept the reason for the overpayment but can't repay it in the time they've asked, call the overpayment helpline on 0845 302 1429 and you can arrange a time to pay arrangement. I think they can spread it out over 12 months without asking any further questions, if you need longer than that I think they can spread it out up to 3 years but will need info regarding your finances (income/expenditure etc)

Clutterfree

Thanks for your reply, but they HAVE been collecting payments from future claims for almost 4 years! Until February 2010 we had not received any payments since 2006 so why did they stop this arrangement? Sorry I know you can't answer that, just trying to work it out in my head! Still can't get through on the 'phone...

EDIT: I am sure we are only entitled to the basic amount which WAS offsetting the overpayment.

sinstar

When was the last time you received a payment? It could be that your claim has now been terminated and everything has gone into direct recovery, did you do your renewal this year?

Clutterfree

Hi.
Yes, I did my renewal and I'm still getting £11.01 every Thursday.
If they hadn't started up these payments again in Feb I'd have paid off about £350 of this overpayment by now.
Still no joy getting through on the helplines.

sinstar

Hmm if you are still receiving payments but getting letters asking you to make a repayment yourself within 30 days it really sounds to me like this overpayment is from a separate claim to the one you have now. Overpayments will only be recovered directly from you if there is no continuing entitlement from the claim the overpayment is from (ie. it has ended or if it's still open, based on your income there is clearly no future payments to be made)

If you've been overpaid and are no longer getting tax credits, the Tax Credit Office will ask for a direct payment - a one off payment for the full amount.

They'll ask you to do this even if you are receiving another award of tax credits for a new household.

It might be you are part of the same 'household' ie. you and your partner haven't split up, but for another reason you have had more than one claim (previous claims terminated after renewals not completed etc)

http://www.hmrc.gov.uk/taxcredits/things-go-wrong/overpayments/repaying.htm