WTC paid into old bank account

pepper33

I did not qualify for tax credits, but last year my income fell, owing to illness, so when I renewed my claim, I was owed a considerable amount of money, which HMRC paid into the wrong a/c. Nationwide are my old bank, and I left them 6 months ago. Never told HMRC, because I had not been receiving anything.
I am making an arrangement with Nationwide to pay off the overdraft, but they have now frozen my account, and will not let me take my WTC out, which I need, as being off ill I fell behind with my mortgage, and other bills. What are my rights?

grumbler

No rights, I am afraid:

• Dont Bank With Debts

maginot

They won't let you take the WTC out because any money paid into that account will go towards the debt you owe.

As you didn't tell HMRC to pay into a different account you have to complaint against them.

Your own rights are to pay off your debt with Nationwide so you will then be able to take any positive balance out.

pepper33

But BCOBS say that they should not be taking benefits from my overdraft, and the lady from HMRC, said they would be claiming it back.

ALIBOBSY

grumbler wrote: »

No rights, I am afraid:

• Dont Bank With Debts

Utterly, utterly wrong. That link is NOTHING to do with the case as set out by the OP. The link basically is about if you have a debt, say a credit card, with a bank you also had say a savings account with. Should you breach the terms of the "debt"-the card, they can offset the "credit" in your savings account against the debt.

OP you need to get a letter done and take it down to nationwide ASAP. You need to write a "First Right of Appropriation" letter.

This basically means you can instruct the bank that this money cannot be used against the overdraft, you are instructing them you need to use the money against certain basic bills (the right of appropriation does not just apply to benefits either).

In other words the bank cannot prioritise their debt over you paying the basic bills you need to pay.

See these threads:-
https://forums.moneysavingexpert.com/discussion/518593

https://forums.moneysavingexpert.com/discussion/1629177

and google First right of appropriation.

Ali x

They should release the money for you to transfer to another in credit account or draw in cash to pay your bills.

grumbler

ALIBOBSY wrote: »

That link is NOTHING to do with the case as set out by the OP. The link basically is about if you have a debt, say a credit card, with a bank you also had say a savings account with. Should you breach the terms of the "debt"-the card, they can offset the "credit" in your savings account against the debt.

No, it is a lot to do with this case and it is not about a savings account. In fact it is about "your bank or savings accounts", i.e. about the current accounts in the first place and it does advise How to ask for a refund if "this leaves you in financial hardship".

pepper33

Thanks everyone, the tax office said they would be reclaiming it, but I will do the letter and get it off to them, recorded delivery.

pepper33

letter sent by email, hard copy going tomorrow

stclair

I didn't think the First right of appropriation applied to tax credits.

Also the First right of appropriation has to be used prior to the bank receiving the credit don't it?

innovate

It applies to any deposit afaik, but needs to be pre-notified.

antrobus

innovate wrote: »

It applies to any deposit afaik, but needs to be pre-notified.

Well, yes, quite.

The way in which 'first right of appropriation' works is that you write to the bank informing them that (a) pounds £x are due to be paid into your account and (b) that you are appropriating those funds to meet certain specified payments.

In the OP's case the money has already been paid into his account, so it's too late, and what's more, he's not using that account, so he would have nothing to have appropriated the money to in the first place.

Bit of a chocolate teapot really.:)