Tax Credit Overpayment advice needed.

arboreal

Hello,

I am having problems with a tax credit overpayment. I wonder if anyone could offer some advice?

We received a demand for repayment of £3,543.62 in July of this year. We had informed HMRC of all changes in our circumstances such as when my partner returned to work following maternity leave.

We sent off a TC846 form on July 19th, stating that we were surprised to receive a demand as we had kept HMRC informed of all changes.

We received a response today, basically agreeing that we had kept them informed but that we still need to repay the amount requested.

Quote:

"...On 11 January 2010 you told us that your estimated joint annual income was £40,238.00. This reduced your entitlement to £1,235.54 which was shown on your award notice dated 13 January 2010.

This also meant that your regular payments were due to go down. We thought that the reduction in your tax credit payments may have caused financial difficulties and therefore we did not reduce them by the full amount every 4 weeks. However, this meant that we paid you more money every 4 weeks than you were entitled to.

We sent you an award notice on 13 January 2010 and explained that we were not reducing your tax credits payments by the full amount. We asked you to contact us if you did not want us to do this. As we did not hear from you, we continued to pay you the extra payments..."

Two things; 1) Why would they think that our income increasing by £14,000 (my partner's income upon returning to work) would have 'caused financial difficulties'? Suddenly being given a demand for £3,543.62 really will cause financial difficulties,we just don't have that sort of money to spare!2) I keep all my correspondence and do not have an award notice dated 13th Jan.

Any advice in dealing with this matter would be greatly appreciated.

Regards,

Robert

Cornish_piskie

arboreal wrote: »

We sent you an award notice on 13 January 2010 and explained that we were not reducing your tax credits payments by the full amount. We asked you to contact us if you did not want us to do this. As we did not hear from you, we continued to pay you the extra payments..."

Hi OP

I haven't come across this scenario before but I suppose the question to ask is did you contact them to say that you didn't want the extra payments?

arboreal

Cornish_piskie wrote: »

Hi OP

I haven't come across this scenario before but I suppose the question to ask is did you contact them to say that you didn't want the extra payments?

Hi,

Thanks for responding.

No we didn't contact them because we never received the letter asking us to. I've just been through all my correspondence again and we definitely do not have the letter they said they sent.

It just seems odd that they didn't just automatically lower the payments. We informed them that my partner had gone back to work, they knew we were substantially better off (£14,000 per annum) but were worried we may face financial hardship losing £3000 per annum. It defies logic.

stroodes

If you are still getting tax credits then they will just take them off future awards.............if you have been over payed why do you not think you should pay back, I just can't get over this culture of people that I got it too bad yer not getting it back.

arboreal

stroodes wrote: »

If you are still getting tax credits then they will just take them off future awards.............if you have been over payed why do you not think you should pay back, I just can't get over this culture of people that I got it too bad yer not getting it back.

Again, thanks for responding.

We are no longer claiming tax credits. So we are supposed to find £3.5k out of nowhere. We just don't have that sort of money. We have both worked since we left school, never claimed any benefits. My partner had to take maternity leave because she had a baby (obv) and was advised by her company's HR dept to claim tax credits.

Our point is that if we kept HMRC fully informed of changes in our circumstances then I would have thought the onus is upon them to stop or reduce benefits paid.

I am not expecting a handout. But I similarly did not expect to be overpaid by £3.5k. You just kind of assume that these government departments would pay the correct amount of money according to the information given.

We have to repay £3.5k in one year. That's probably not a problem for someone as canny and fiscally astute as yourself but for us it's really difficult.

Thanks for your input.