HMRC Tax Credit Over payment from 8 Years back!!!

j_smith_007

My parents have been requested to pay working tax credit over payment within the duration of a period over 8 years ago. (2004-2005).

Is this even possible?

If not how do I go about removing the debt.

If so, how do I get the HMRC to prove that they are liable to pay, and the amount is correct, and not just plucked out from thin air. As this over payment presumably came from an error, how do they know this isn't one.

Help appreciated....

skateykatey

yes, it is entirely possible and not necessarily the cause of HMRC error. Most overpayments are wholly due to customer error.

It cannot be just removed. Download form TC846 (or ring the helpline for one) to dispute the overpayment. You will then receive an explanation.

Have you looked through their old award notices from these years to try to ascertain how this overpayment occurrred???

j_smith_007

From doing a little digging they apparently had one letter stating they owed 1k many years ago and then 5k (yr 2005) and now it has gone back down to 3K.

There appears to be some inconsistency here. Is it possible to use this as proof of discrepancies.

I've heard the government has to write off debt if they have not contacted you for a number of years is this true?

sarahg1969

Tax credit debts are subject to the limitation act like any other debt. If the debt is over six years old and no payments have been made in the intervening period and the debt has not been acknowledged and your parents have not deliberately avoided contact (ie given a fake address), then they are out of time to recover the money through the courts. The debt recovery people know this but will tell untruths. They told me the six-year period does not begin until they are passed the file. Not true.

SuziQ

Is that true, Sarah? I have read here many many times, and by members who work for tax credits, that tax credit debt is not subject to limitation like other debts.

Icequeen99

SuziQ wrote: »

Is that true, Sarah? I have read here many many times, and by members who work for tax credits, that tax credit debt is not subject to limitation like other debts.

Tax credits are subject to limitation, it is tax that isn't.

See http://www.hmrc.gov.uk/manuals/dmbmanual/dmbm595080.htm

However, often in tax credits there is a period of ongoing recovery from an award so you can't just use the year of debt to presume that the 6 years gave expired.

IQ

sarahg1969

I've just been trawling t'internet for that and just came back after finding it to see you've beaten me to it. Couldn't find it on my phone earlier!!

http://www.hmrc.gov.uk/manuals/dmbmanual/dmbm595080.htm

In my case, there has been no claim for tax credits since 2004, so no repayments whatsoever have ever been made, and they're quite simply out of time now.

However, it's not quite so easy if you've continue to receive them and any adjustments have been made.

Another fib they told me on the phone was that a tax debt never dies (which I know is true, but tax credits aren't tax). They're very naughty indeed. I did, of course, refer them to their own guidelines and suggested they might require more training if they were unaware of them. Ahem.

I was considering making an FOI Act request, but looking on whatdotheyknow, it seems they don't bother answering many of them.

j_smith_007

Thanks for the link.

Does anyone know the best way to articulate this to them.

Is it just a case of sending a letter to the HMRC, stating the case, dates involved and quoting the act?

Has anyone had any experience with doing this.

Thanks again.

Icequeen99

j_smith_007 wrote: »

Thanks for the link.

Does anyone know the best way to articulate this to them.

Is it just a case of sending a letter to the HMRC, stating the case, dates involved and quoting the act?

Has anyone had any experience with doing this.

Thanks again.

I would suggest you get some legal advice. It is not a straightforward area of law. You could try a letter to them but I suspect you won't get very far.

IQ

j_smith_007

Thanks, I'll try a letter first, and let every one know the outcome, just in case others are in a similar situation.

sarahg1969

Just be aware, even if you write to them and spell it out to them, they still keep writing to you, about once a year. In my case, I get a single letter once a year asking me for repayment.