Help - Old (2007) Tax Credit Debt being chased

liam8282

My partner has an old tax credit debt that we have just received a letter about today.

This relates to what the revenue said was an overpayment relating back to 02-08-2007.

We have disputed this debt since it first arose, because the tax credits had been calculated incorrectly from the start date.

The Revenue would not recalculate the tax credits retrospectively, even with evidence, P60s and anything else they required.

At the time the Revenue said a large overpayment was made, and because we had given the Revenue all information at the time, we presumed it was correct, basically because we were young and naive. We had to take a loan out to pay back the overpayment and we again presumed everything was present and correct.

A few years later, we were told about this new overpayment. We had grown up a bit and started to question what was going on. We asked for the Revenue to go back and recalculate tax credits to show that we had in fact been underpaid, but as I said they just were not interested.

This went as far as requesting information from them, contacting our local MP and then as we were still disputing all of this, contact suddenly went quiet and then stopped.

(I am working from memory here, so do forgive me if I prattle on, or get bits wrong!)

Now, today we get home and another letter from the Revenue, saying they appreciate they have not been in touch for some time but the debt is still unpaid.

First of all, the initial debt is over 6 years old, so can we argue under the Statute of Limitations, they can longer recover this debt?

They have sent us letters about it since 02-08-2007, but the last letter must have been about 4 years ago, off the top of my head and the debt was always in dispute.

I am sure that is the excuse the Revenue gave for not looking back over our original tax credits, or some other rule or regulation they had?

This is just worrying and I want to get it cleared up, once and for all.

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

fatbelly

If they take action in the county court you have a defence.

But they have lots of other options available to them. This seems a useful explanation:

http://www.revenuebenefits.org.uk/tax-credits/guidance/how-to-deal-with-hmrc/dealing-with-debt/#enforcement

liam8282

Does anybody have any advice?

What do you think my next step should be?

Should I write to them stating that I have never acknowledged the debt, only ever disputed it and that it is now statuate barred, or should I ignore it, or anything else?

MissMoneypenny

liam8282 wrote: »

Does anybody have any advice?

What do you think my next step should be?

If they haven't already given you a breakdown of what you owe, ask for that. If you owe this money, then you will have to repay it and sort out a repayment plan with them. How much is the debt?

liam8282 wrote: »

Should I write to them stating that I have never acknowledged the debt, only ever disputed it and that it is now statuate barred, or should I ignore it, or anything else?

Don't ignore it. If they can't take you to court, then they can simply take the money you owe the welfare state from any future benefits you ask for and are given. The debt will not just go away if you ignore their letters. Sort it out with them, now.

liam8282

MissMoneypenny wrote: »

If they haven't already given you a breakdown of what you owe, ask for that. If you owe this money, then you will have to repay it and sort out a repayment plan with them. How much is the debt?

Yes, we went through all this in 2009. It was a big pain, writing letters back and forth, contacting our local MP and having them write letters. Honestly, it was a nightmare.

We do not owe this money and have always disputed it.

MissMoneypenny wrote: »

Don't ignore it. If they can't take you to court, then they can simply take the money you owe the welfare state from any future benefits you ask for and are given. The debt will not just go away if you ignore their letters. Sort it out with them, now.

As I said, we do not agree that it is a debt and never have.

Which is why I am looking toward it being statuate barred, as it is over 6 years, we have never acknowledged it, only ever disputed it and just want it to end.

I think that is the road I am going to go down, but need a bit more advice on something being statuate barred. From what I have read from my first link, it totally agrees with our situation.

I simply have no faith in the tax credits department and don't want to get back into all of the arguing and letter writing again.

slg_sue

liam8282 wrote: »

Yes, we went through all this in 2009. It was a big pain, writing letters back and forth, contacting our local MP and having them write letters. Honestly, it was a nightmare.

We do not owe this money and have always disputed it.

Did they issue a final response to you? Do you have any of the letters that were sent back then? (sorry if you have already answered this)

I am currently in dispute/appealing an overpayment with them and I understand what a nightmare tax credits are.

I would get back in contact with your MP, dig out everything you can find and issue them with a formal complaint.

MissMoneypenny

liam8282 wrote: »

Which is why I am looking toward it being statuate barred, as it is over 6 years, .

All that will do is stop them taking you to court. Unless you sort this now, they will just take the debt they say you owe, from any other benefits you claim in the future.

You are going to have to contact them and sort out if it was an overpayment. As they are still chasing you, it seems they are adamant that you had on overpayment. This isn't going to go away until you sort this with them.

liam8282

Sue-

I have found old letters, emails, emails to and from our MP, all from 2009.

I don't think it ever got finalised, the Revenue said we owed them money, we said we didn't, disputed it, this went backwards and forwards for months at the time, until a point came where they never got back to us, until yesterday.

I am pretty sure that I am correct with the statuate of limitations ruling on this, but I am not confident enough to start writing them letters, as I don't want to open another can of worms with them, as it was such a nightmare last time.

I would welcome a complete review of our tax credits from start to present, as I am certain that errors were made by the Revenue, but they just flat refuse that idea from the start, yet spend so much time and effort chasing this money, which again I am certain is not owed.

I will contact my MP, hopefully they will have access to somebody who can give a definitive answer on what course of action to take.

liam8282

MissMoneypenny wrote: »

All that will do is stop them taking you to court. Unless you sort this now, they will just take the debt they say you owe, from any other benefits you claim in the future.

I don't have enough understanding about this.

From my limited knowledge, this is my interpretation:

A debt over 6 years old cannot be recovered if you haven't commenced proceedings for recovery of debt before that 6 year period.

As I say, the debt has never been acknowledged, it has always been in dispute. The Revenue have never commenced proceedings to recover it.

So now, surely they are out of time, to start proceedings or even attempt to recover it.

This applies to tax credits.

It is all in the link in my first comment.

MissMoneypenny

liam8282 wrote: »

I don't have enough understanding about this.

From my limited knowledge, this is my interpretation:

A debt over 6 years old cannot be recovered if you haven't commenced proceedings for recovery of debt before that 6 year period.

As I say, the debt has never been acknowledged, it has always been in dispute. The Revenue have never commenced proceedings to recover it.

So now, surely they are out of time, to start proceedings or even attempt to recover it.

This applies to tax credits.

It is all in the link in my first comment.

This a debt you owe to the welfare state, as they say you have an overpayment of benefits. That debt will not go away by you saying it is barred, as they will just take the money they say you owe, from any future benefits you are given. They may not be able to take you to court, but they will get the money back for the taxpayers.

You will need to deal with them now and get this sorted. They will either prove to you that you do owe this money and sort out a repayment plan with you; or you will be able to prove that you weren't overpaid benefits and they will amend their records to show this.

How much do they say you owe?

liam8282

MissMoneypenny - I think you are getting a bit confrontational. I don't want to be insulting or confrontational myself, but you are not really answering or adding anything to this discussion. It just seems that you are posting what you think, rather than any hard facts or advice here.

I am a taxpayer.

I do not owe this money.