Advice on Child Tax Credit Overpayments

jensmcken

Hi, I'm stuggling to understand why the Tax Credit people have done what they have done with my claim and advice would be gratefully recieved.

My circumstances have changed throughout the tax year and at each change I have informed the helpline. The most recent change (my husband has become employed full time) has resulted in us being overpaid for the year so far by £400. I understand this and don't have a problem however I've been informed by the tax credits people that they will have to continue paying me (know that I'm not entitled to it and that I already owe £400) and that by the end of this tax year I will owe £1400.

I've calle them to ask them to just not pay me any more money but I was transferred to 3 different department, of which none could help me, and was told that the only way to do this was to cease my claim which would result in me owing all of the money I have recieved this tax year.

This makes no sense to me. I was under the impression that if I informed them of every change in my circumstances at the time of the change then I would not be liable for any over payment so why are they intentioally overpaying me? It's put me in a very uncomfortable situation and I'm afraid of spending any of the money that has come from them this year.

Any help / advice?

Icequeen99

The way tax credits work with annual income spread over the year means that if you report a change of someone starting work it can lead to a small overpayment.

When you have a change that effectively means you are not entitled to anything for the rest of the year, they keep on paying you so that you don't suffer hardship (or that is their theory anyway) but it does as you say increase the overpayment

If you look on teh award notice, it should explain this but it should also say if you don't want the payments to contact them.

They don't need to end the claim. They have a process to deal with this.

If they are still refusing, i suggest you just put the payments aside and repay it after the end of the tax year.

IQ

kelpie35

Why not take the money just now, put in high interest account, then pay back at end of year.

jensmcken

Thanks Ice Queen. The notice did have a number to call to discuss stopping the continued payments but when I called it no one seemed to know what I was talking about and I ended up being put through to the debt recovery team. Most unhelpful. I'll give the number another go though.

Thanks

Sparkletoes35

I deal with tax credits every single day and none of them say the same two words!! My advice is as above, set up a s/o with your bank to pay the money into a high interest savings account, dont touch it, then when at the end of the financial year, pay it back and spend the interest. You could however ask for them to send you written confirmation of records of telephone calls (which I have experience of) and more than likely they can't provide it therefore your word against their and then you can appeal the overpayment. To be honest, far too complicated and if you can't be jiggered with the hassle, save and don't spend it.

Icequeen99

Sparkletoes35 wrote: »

I deal with tax credits every single day and none of them say the same two words!! My advice is as above, set up a s/o with your bank to pay the money into a high interest savings account, dont touch it, then when at the end of the financial year, pay it back and spend the interest. You could however ask for them to send you written confirmation of records of telephone calls (which I have experience of) and more than likely they can't provide it therefore your word against their and then you can appeal the overpayment. To be honest, far too complicated and if you can't be jiggered with the hassle, save and don't spend it.

But the OP can't appeal the overpayment. You can only appeal if entitlement is wrong - in this case the OP would indeed have been overpaid compared to her entitlement.

The OP could dispute, but not appeal.

IQ

Sparkletoes35

Complete a TC846

Visit the hmrc website but prepare to appeal come end of tax year! Due to the way tax credits are worked out, its never a confirmed "overpayment" until the year end.

Icequeen99

Sparkletoes35 wrote: »

Complete a TC846

Visit the hmrc website but prepare to appeal come end of tax year! Due to the way tax credits are worked out, its never a confirmed "overpayment" until the year end.

Appealing and disputing are two different things. The TC846 would be for disputing. But the OP shouldn't appeal at the end of the year, there would be nothing to appeal as entitlement is correct.

No harm in trying a dispute though.

IQ