HMRC Child Tax Credits overpayment

PippaGirl_2

I was declared BR at the end of May 2012. I wasn't well at all, am registered disabled due to mental ill health then and currently. I was receiving child tax credits for my disabled daughter prior to going BR. I received a renewal pack for child tax credits in April 2012 asking for my financial circumstances form to be completed and returned by the end of July 2012. By then I had received notification of my final payments as my dd was 20 at the beginning of June so my payments were stopping. So mistakenly I believed that the form only needed completing if I were eligible to receive tax credits for the next financial year so I didn't return it.

The first I knew of this mistake was a letter arriving August 7th 2012 asking me for the almost £1000 paid since April 2012 back as I hadn't returned the form. I telephoned them straight away and a man took me through the financial circumstances form over the phone, as I remained on income related employment support allowance he said I was still fully eligible for the money and he would put it through and even though this was one week later than the deadline all would be fine.

Next I know in September was another legal letter demanding the money back. I telephoned again and said I was declared BR in May so any overpayment would be included in that but the person felt the simplest way was for them to send me a form to explain why I had not returned the form on time and appeal their decision. So I completed that form in September 2012 and heard no more about it. So I assumed they had accepted my financial circumstances and that the form completed over the phone was one week late and allowed it.

Yesterday (14 months later!) I received a letter from HMRC saying apologies for the delay in replying (!) but they have looked at the reasons for my returning my form late and have considered it and have found that I did not fulfill my duties by returning the form on time as set out by their code of practice 26 and as such need to return all monies paid since April 6th 2012 which is almost £1000. Which I don't have.

I think it is disgraceful that they can legally demand money back when someone mistakenly doesn't return a form as they didn't believe they needed to given payments were stopping before the date the form needed to be returned by, even though they admit I was eligible for the money given my income related benefits. I do have mental health issues but believe this is a mistake anyone could make and then they'd be left with legal demands to pay back money they financially need and rely on and were eligible for just because something was 7 days late.

Anyway, back to the BR question. I am fairly sure that the child tax credits were paid in advance and am fairly sure that my final payments were made in May 2012 and if that is the case then I am 99% sure that this overpayment is included in the BR and they cannot claim it back from me as all payments were received before the date of BR?

Unfortunately the payments went into an old bank account and as I couldn't afford to photocopy the bank statements I sent all original bank statements for the 12 months proceeding the BR to the OR special delivery so I no longer have them and that account was closed by the bank following the BR. The reason I feel sure that the payments stopped before I went BR is because my Co-op cashminder account was up and running prior to the BR and if I was expecting income from tax credits after the BR date I would have given them my new bank account details (in case the old account was frozen) and had the payment placed into my Co-op cashminder account and I know for sure that no tax credit payments went into the cashminder after my BR date.

I can't therefore prove I didn't receive anything after my BR date as I don't have the statements, but if a payment did go into my old bank account after my BR date, would I still need to pay that payment back? I was discharged in January this year so my OR can't even help me find out as I would assume they have closed my file and destroyed my bank statements. I can't believe the HMRC have contacted me after 14 months with this and I am feeling so stressed it's untrue.

Any advice appreciated. I'd thought debt letters were a thing of the past. It's not as if I wasn't eligible for this money, just that completed the form was 7 days late.

National_Debtline

Hello there.

You are right, non-fraudulent benefit overpayments, where the end date of the overpayment is before the date of the bankruptcy order, would have been written-off when you were discharged. One idea to try and obtain the information you need could be to send the bank a 'subject access request' under the Data Protection Act. The fee for making a request is £10. You would be entitled to all of the information that they hold about you on a 'relevant filing system' - such as electronic databases. Generally the data goes back six years. The bank would have 40 days to complete your request.

There is some useful information about subject access requests on the Information Commissioner's website:
http://www.ico.org.uk/for_the_public/personal_information

I'm really sorry to learn of the situation, we often hear from lots of clients in very similar positions to you - so I can absolutely appreciate the frustration you feel.

If there is anything else you need, please post again and we'll do our best to help.

David @ NDL.

Coigach

The tax credit people are a bit erratic in handling a situation when returns aren't submitted within their stated deadlines. If you've responded as soon as you realised there was a perceived problem in their eyes, then you should be OK. Most MPs are very helpful if the Revenue are behaving in an inequitable manner.

newstart2012

Hi pippa
I was in exactly the same situation and they wouldn't have any of it and insisted I repay. Am now paying £10pm as that's all I can afford. Hope you get it sorted.

SomebodyToldMe

I'm about to go BR, and owe HMRC about £7k- they overpaid me- but was told this can be included in BR by CAB.

PippaGirl_2

I have since had another letter from the HMRC saying they are handing my debt to a debt collection agency.

I am not legally liable to pay and don't therefore intend to pay (I don't have a single spare penny to pay anyway, I have had to borrow money for food last month and this month) so I guess I will need to let the debt collection agency know about the BR when they contact me.

What a nightmare, this should have all been over by now.

wheezy57

Pippa, I know how you must be feeling. I had a similar tale to tell with HMRC for TEN YEARS. I wouldnt hear for years and then bam! Each demand was different ranging from £9,000 to £97. I argued and argued. Every phone call to them was a nightmare. Nobody but nobody would accept that their system had made gross errors.

I refused to pay and informed them I was prepared to go to prison if necessary. I stood by my guns. I had all the paperwork if anyone cared to look at - they didnt of course.

Then out of the blue in November I got a letter stating that due their errors (understatement) the demand for payment would cease. I owed them nothing. I wrote back saying how pleased I was that it was all over and they then sent me a letter saying they would pay me £50 for all the incoveniences over the years.

Guess what! They put the £50 in the wrong bank account.

Is there a moral to this sorry tale of ineptitude and incompetency - yes, there is. Stick by your guns and dont be browbeaten by threats of bailiffs, debt collection men and the like. If you truly believe that they have made some sort of error (it could just be a typing error!) then dont ever give in. Argue the toss. Question and ask for indisputable proof.

Incidentally I have since had another letter saying I owe them £54. The answer to that one is SWIVEL.....

PippaGirl_2

I have just had another letter from HMRC saying I owe this money. I have finally got through on the phone after an hour on hold and the woman tells me that overpayments created before the date of your BR are still owed and only overpayments made during the term of your BR are written off by the BR so I still owe the money.

Is this true?

I am thinking of going BR again to get rid of this debt, it's nearly £1000 and I don't have any spare money at all to make any payments. The charity that paid my BR fees may pay them again. As any tax payments I received were before the date I went BR in 2012 I really thought this was over but it seems not. I have been in tears all day.

lilybankrupt

Awwww Pippagirl don't let the !!!!!!s get to you, and definitely don't go BR again over this amount.

There's a very useful thread on a similar topic here that provides all the info, including extracts from the Insolvency Manual and DWP's own internal guidance.

Within DWP's guidance I found this useful point (although it relates to housing benefit my understanding is all state benefits are included in the new rules)

"When a debtor is discharged from bankruptcy (or Sequestration in Scotland) then any non-fraud debts, where the end date of the overpayment is before the date of the bankruptcy or sequestration order, must be written off. This must take effect immediately."

Here's the full thread..

https://forums.moneysavingexpert.com/discussion/4920685

Gaz83

To be fair on HMRC, NTC have now been running for over ten years, and it's heavily publicised each year that you still need to do a declaration even if you're not claiming for the subsequent year, as they need to check the amount you received in the previous year was correct.

I of course sympathise with the OP but it's a bit harsh blaming HMRC for this.

fermi

PippaGirl wrote: »

Is this true?

No it's complete ballhooks.

Trick is getting the numpties at HMRC to understand that.

I would suggest that you PM debt doctor, as I think he has had previous success at banging their head together?