BR & tax credits overpayment

debt_doctor

pizzarepairman wrote: »

Hi DD, thank you for the quick reply.

Am I best to call them about this in the first instance? And is there some thing I should refer them to to say why I am raising the complaint (e.g. legislation or case law?)

You should use the information Fermi has provided in #2 - perhaps print it off and send to them by recorded delivery along with your letter requesting monies be returned.

DD

pizzarepairman

Hi again,

After your kind advice in October I wrote to HMRC.

TODAY I have had a reply....

They say that the overpayment "can't be included in the bankruptcy claim as a Final Award Notice/Statement of Account/Notice to Pay was not issued prior to the date of bankruptcy"

My BR date is 26 May 2010. I have a Final Tax Credits Decision for 06/04/2009 to 05/04/2010 dated 17 June 2010 that details the overpayment.

In the advice you posted a link to is a chart re overpayments (40.102A Summary of position re overpayments of benefits (amended August 2013)

. My understanding of the chart is that as the Tax Credit was overpaid before the BO it is a provable debt and no recovery is applicable. Even though the recovery order was made after the BO

Am I correct? If so could you advise how I might proceed please?

Thanks

fermi

Correct. Whoever wrote telling you it isn't covered is wrong. Send them a copy of those paragraphs from that link, and refer them to the Supreme Court case of Nortel and others [2013] UKSC 52

pizzarepairman

Judging from a phone conversation yesterday it seems likely I will get the money I have paid to HMRC back, but the case worker I spoke to is awaiting confirmation from their Legal dept. Hoorah (possibly)

Will they pay interest as well? If so how is it calculated?

SomebodyToldMe

Hi all,
HMRC really are scum of the earth.....
My CAB adviser put my overpayment into my BR petiton, and as it was prior to me going BR, HMRC are not due anything.
This has stopped them doing my latest award, showing how much they plan on recovering each month!!!
Like what others have said- don't arrange any payment for them if the debt occurred before BR.
Also, be warned- the Con dems are looking at removing the right to put this kind of overpayment included in DROs according to my CAB- be sure if passed, BR will follow.

Bazza73

Hi team,

I have a similar situation to above. I need your advice please.

I went bankrupt in Sep 2012 and HMRC are chasing me and my wife for tax credit overpayments from 2010/2011 of around £1200. I contacted HMRC after my discharge and informed them about the bankruptcy. I also had the overpayments listed on my bankruptcy debts form to the OR.

Their response was that HMRC treat the tax credit overpayments on a household basis, as opposed to tying it to the individuals. If both my wife and I had gone bankrupt covering the same period, then yes, the overpayment would have been included in both of our bankruptcies. However, since only I went bankrupt, the household debt transferred to my wife during my bankruptcy period, and then back to both of us again after my discharge.

I've tried disputing the overpayments over the past few years but am getting nowhere with HMRC. They have now passed it over to a DCA.

1. Is this legal/correct that HMRC can do this to bypass someone's bankruptcy? All the other posts seem to deal with an individual and are not clear about couples.

Thanks.

egrescrimp

My understanding is that is correct, the claim is in joint names so they can recover the money from your wife as she hasn't been declared bankrupt.

Bazza73

hi egrescrimp,

Ta. I knew they would try to pursue my wife, but they are also now re-pursuing me too.

egrescrimp

They can't pursue you, just provide proof to the debt collector that you were made bankrupt and they should be fine with just chasing your wife depending upon the size of the over payment they are likely to sell the debt rather than just try and have a DCA collect for them from you, at that point it should be much easier to also prove the debt isn't yours.

So far I've been pretty lucky with HMRC, they have handled everything of mine without any fuss.

Bazza73

Just wanted to add a few useful links to HMRC guides I found on this - may be of some use to others.

TCM0224040 - Payment - overpayments (A-C): overpayments - bankrupt or sequestrated customers
http://www.hmrc.gov.uk/manuals/tcmanual/tcm0224040.htm

How HM Revenue & Customs handle tax credits overpayments
http://www.revenuebenefits.org.uk/pdf/How_HMRC_handle_tax_credits_overpayments.pdf