Overpaid Tax Credit Award

System

I received what the IR think is a correct award in Jan of this year.  I have been overpaid over £3000.  The situation has still not yet been sorted as there is not yet a dept to deal with overpayments and errors! The mistake is IR not mine as I spent the last year telling them they had got it wrong.

I am now in the situation where I am waiting to find out if I have to pay it back or if they will "write it off" as it was their error.

You have my simpathy! >:(

Actually there is a department that deals specifically with overpayments and you can telephone them. The department is called Receivables. The Tax Credit Helpline can give you their tele no if you need it.

System

they paid my sister £3,000 out of the blue and told her to hang onto it, they would ask for it back in april. well, fortunately they haven't asked yet, she's spent it all. 3 thousand pounds is a lot of money to ask some people to leave sitting in an account, she started to spend it little by little, always telling herself that she would pay it all back into the account before they asked for it in april.

i can see how overpayments might happen if circumstances are constantly changing, and the working families tax credit part, the childcare part etc. are always changing - but why have they paid me more than a thousand pounds today? it's in 2 payments, they put it straight into my bank account, i haven't had a letter explaining why. i'm not on the working part of the tax credit, i only claim the child tax credit part that everyone used to be entitled to, it was around ten pounds extra in tax relief every week, and now it's around £545 per year. i work part time but we don't pay childcare, we just fall into the bracket where people get £545 for having a child, that's all. no childcare, no top ups, no difficult changes in circumstance. why on earth have they paid us all of this money? we are overdrawn and having this money in our bank account reduces the amount of overdraft interest we pay - is it okay to leave the money in our account until they ask for it, or do i have a duty to tell them? i'm not a single mum but we have a lot of student debt between us so budget-wise we're no better off than when i was a single mum on income support, so using this money to reduce our overdraft interest and therefore reduce our debts in the long term is a very attractive prospect ...

Fran

shazbat -

As it is the Inland Revenue you are dealing with, I suggest you phone them and ask exactly what's happening and can they send you a breakdown of how they got to that amount. You could then get this checked at your Citizens Advice Bureau, where you can also check that you are getting all the benefits you may be entitled to.

You say you work part time. If that's over 16 hours you would be entitled to Working Tax Credit. Is your partner working? If the total no. of hours between you is over 16 you may be entitled.

Check this website for information:- Citizens Advice Website

The danger of leaving the money in your account and doing nothing is that you spend it and then aren't in a position to pay it back, so making your situation worse. It's very tempting when you are on a tight budget and already have debt.

System

>:( When I first applied for working and child tax credits I recieved four different letters from the Inland Revenue with four different awards I was supposedly entitled to. It took a few days and phone calls to find out exactly which award I was entitled to.

Now a year later I have just received a letter stating that my tax credits have been overpaid by over £3000!

It is very clear to me that from the beginning human error in the IR is to blame! How can they get away with this incompetence?

System

thanks for the reply, Fran.

well i work 18 hours per week, my husband works 38 hours per week, and we have no childcare costs (i work while my son's in school). we are not entitled to working tax credit, hubby earns a good wage. all we're entitled to is the £545 a year award for having a child, that's all. due to debt we're on the breadline, but that's not relevant, just to confirm that we are totally skint, lol!

after they paid 1200 into my account last week, and another 145, hubby was told by his workplace that tax credits have instructed them to pay him an extra tenner a day! they are reluctant to do this. hubby didn't know what was going on, asked me to investigate.

so i called tax credits, got some muppet on the other end who read out my details to me. "can you confirm that you work 18 hours a week and earn no income, and your husband works 38 per week and earns no income?" erm, no, i can't confirm that. we actually work for a living, we earn a wage.

they had decided that we both work for nothing, and wanted to give me 2k a year and hubby 4k a year. very nice of them :-)

she says that it's the internet site that called the mix-up. when i told them i'd started working, they recorded every detail of my job apart from my wages, and at the same time decided to erase my husband's wages too, for no apparent reason!

janiewai

Sounds like ours from last year! They had my Carers allowance down as my income then stated where hubby worked and how much WTC he would get but omitted to put in his income! I rang them and they said it was right!

Result....we owe then over 3k this year so no tax credits at all, we have a disabled child and are now down over £100 a week and wondering whether to eat or pay the rent.

Ah well at least I am a size 12 now instead of an 18

filigree_2

I wonder how easy it is to get money back from your bank? If a £2K overpayment gets sucked up by your overdraft, your bank are going to be reluctant to let you have it back.

ISTR that in the olden days of Family Income Support, if the DHSS overpaid you because of their mistake, and you reported it, you didn't have to repay the money. Unfortunately the taxman has always had the power to snatch his money when he likes, even if the initial error was the fault of the Inland Revenue.

FieryBlondeScot

the plot thickens..... they said i owed them over 3grand. i made numerous phone calls to them and was told i did definetly owe them it and i would definately hae to pay it back, another time i got 'ooh actually WE owe YOU money'. i faxed my mp and he wrote to the head of inland revenue, today i got ANOTHER revised tax award notice which said they were reviewing my case and would reinstate this years tax credits (545quid which they had suspeneded as they were using it to repay my 3grand) and the amount i owe them now appears to be 300 quid. well i am thinking it would be wicked if i only owe them 300 quid but experience with these folk jus tells me no doubt when they are finsihed 'reviewing' my case i will still pwe them 3grand PLUS however much of this years 545 they pay me!!!! i wait with bated breath, i am at the point now i almost do not even want any money off them!

System

they have sorted mine out now, they know what we earn and they know that we're only entitled to £545 a year. what they are doing is not paying me any extra this year (£411 i would have had). they are saying that i owe them £300 but can pay it back in future years. they have overpaid my hubby but only want £411 of it back this year (that's where my £411 for this year has gone, the two have cancelled each other out). as for the rest of the overpayment, they want that back in future years BUT they still want his work to start paying him this ten pounds a day starting next month, and they want the payment to carry on all year, until he owes them more than 3 thousand. they've already worked out that he's not entitled to a bean off them, but they want to keep paying him all year and then decide in future years to ask for some of it back. WHY ??! why can't they stop paying him the extra? he already owes them money, why do they have to get his work involved, and keep giving him money that they know he's not supposed to have? i just don't understand!!

how do they take the money back in the future, does anyone know? do they have the power to just take my husband's monthly wage without informing us first?

scouselass

Similar tale.......however I haven't had any decision letters about overpayment, but noticed my TC payment to the bank had been reduced. So I followed this up with IR and they inform me that I have been overpayed and they are recovering this from my TCredit payments!!! It would have been nice to be told.

I too, had two changes of cirumstances last year and these were notified immediately to IR, and I kept records, dates and documentation etc so I will defintely be lodging an appeal and I am awaiting my cop 26 forms.

This particular item has been read approx 1000 times, and so far about 20 + people have posted. I really think EVERYONE should contact their MP to register what is happening to them. Even an individual who didn't tell IR about a change, and who does owe money, the IR have still set up a system that is extremely fragile. The whole Tax Credit set up 'procedurally' makes it so easy to incurr an overypayment.......there is something fundamental that needs to change. Tax Credits themselves are a good idea, but they are top up for those people whose income is low enough, and the need extra cash......so it really is outrageous for the whole thing to go so wrong so easily. So anyone with a tax credit ovepayment, irrespective of where the responsibility lies, do tell your MP.........because to me it is not disimilar to dodgy banks who give easy credit without checking properly.....and then hound the individual when they have got into debt. So lets name and shame IR for their big administrative mess.