Tax Credits 'Repayment' threat - Help needed please...

Davemac

Hi all.

I’ve had an ongoing issue with the Tax Credits Office for six months now and would really appreciate some advice and feedback from anyone who can help.

I never even knew about Tax Credits until I started working again in 2009 after a long period of unemployment (over a year). I was advised that I may be eligible by a colleague and duly applied.

Sure enough, I was granted Tax Credits, payable direct to my bank account on a weekly basis from November 2009 to July 2010. This included an original lump-sum payment up front, which was – if memory serves correct- in respect of backdated payments.

Either way, I received the amount they said I would be paid each week for the allotted time period. After that, I didn’t apply again as I thought that I had used up what I was due. I later received a letter from the Tax Credits Office in June 2011, informing me that I had been overpaid by £805 during the period when I received the Tax Credits and that I would need to pay this back in full.

Naturally, I was taken aback and contacted them by phone. After a friendly conversation, I was sent the relevant paperwork and told to dispute in writing, proving how the overpayment was nothing to do with me and an oversight on behalf of the Tax Credits Office.

I duly did this and thought the matter so cut and dried that I would be free from this financial burden (I am once again unemployed and unable to pay back even a fraction of the amount quoted). I heard nothing until I received a letter today, telling me the following:

"For us to write off an overpayment, you must be able to show that you have met all of your responsibilities as set out in our Code of Practice 26.........Having considered all the relevant facts about how your overpayment arose, I do not think that you met all of these responsibilities. For this reason, I cannot write off the overpayment and you will have to pay the money back."

Responsibilities? I am not an accountant, nor do I work for the Tax Credits Office. How would I know I was being overpaid? I have it in writing what I was told I would receive - and in what time period- and that is how it played out. I politely pointed this out when disputing and I fail to see how I can make this any clearer.

In short, I am unable to pay this back and don’t intend to on principle. I have made no error at all as far as I can see. Rather, it is an oversight/blunder of their making.

Basically, I need to know where I stand legally, as I can’t pay this back – even if I wanted to - what with being unemployed and hardly swimming in cash.

I will need to inform them of my flat refusal presumably, but I would imagine they would then issue threats of court and bailiffs. To be able to quote any legal rights I may have in this situation would of course be a massive help, so any advice on the above would be most appreciated.

Thanking you in advance.

DM

MrsManda

[QUOTE=Davemac;48910283
"For us to write off an overpayment, you must be able to show that you have met all of your responsibilities as set out in our Code of Practice 26.........Having considered all the relevant facts about how your overpayment arose, I do not think that you met all of these responsibilities. For this reason, I cannot write off the overpayment and you will have to pay the money back."

Responsibilities? I am not an accountant, nor do I work for the Tax Credits Office. How would I know I was being overpaid? [/QUOTE]

You don't need to be an accountant or work for the tax credits office to have responsibilities.
The responsibilities they're referring to are on page 6-9 of the Code of Practice http://www.hmrc.gov.uk/leaflets/cop26.pdf

Have a look and see if you did meet these responsibilities. If you did then you can challenge their decision, if you didn't and the HMRC met their responsibilities (also in the document linked above) then you need to contact them to arrange a repayment plan.

Davemac

Thanks for the swift response MrsManda.

I should have mentioned that I was sent a hard copy of that Code of Practice a few months back and was indeed satisfied I had met the responsibilities, hence the dispute.

Appreciate the feedback anyway.

karenx

So after you decided not to apply again did you tell them this and give them your income figure for the year you had just claimed for? You must do this at the end of the tax year so they can see if they paid you correctly or not. If you dont do this you need to repay everything you recieved

Davemac

Hi Karenx.

I did disclose these figures as far as I can remember - they are definitely aware of them anyway - although I will need to check if that was done at the end of the tax year or later.

Thanks for your reply.

AnxiousMum

Part of the responsibility of claiming tax credits is that at the end of the financial year, you also complete a 'renewal' form confirming your final income for the financial year to balance out the year end. This ensures that if there was any change in income, that this is taken into account regarding the payments you have received. If you have not done this, then they will be claiming back the full amount, as you have not given the final figures.

They say you owe £805 - is that the total amount which they paid you? If so, then it would make sense it happened due to not sending in final paperwork on time.

Davemac

AnxiousMum - I think they paid me more than £805 to be honest. I don't have the figures to hand, but will see to that shortly when I will get everything down on paper, as I begin to consider my next move.

Thanks for your reply.

Icequeen99

It is possible this overpayment is due becauseyou didn't renew in May/June/July 2010. the payments from April to July would be overpaid if you didnt.

Does their letter give no indication of the reason why? Normally it will give reason. Hard to adise until you get that more specific reason.

IQ

cosmic-dust

Davemac wrote: »

Sure enough, I was granted Tax Credits, payable direct to my bank account on a weekly basis from November 2009 to July 2010. This included an original lump-sum payment up front, which was – if memory serves correct- in respect of backdated payments.

I'm guessing this is where your overpayment came from.