Working Tax Credit Overpayment

caroll72

I am currently in dispute with HMRC who are demanding repayment of nearly £500 working tax credit for the tax year 2012 - 2013.
During this year, OH & i were in & out of work, due to zero hour contract jobs & agency work.
Each time that work dried up, we signed on for jsa, but we got a 4 week run on, of working tax credits.
However, our jsa was reduced, by the element of tax credits paid each week.
For example: £110 weekly jsa. £35 wtc, meant jsa was reduced to £75 a week.
HMRC are now wanting this money back, but my argument is that we would then have been living on less than the government says is the minimum benefit for a couple.
They're having none of it, & telling me to contact DWP regarding the reduced weekly benefit.
Thought the Inland revenue & DWP worked hand in hand.
At my wits end & don't know which way to turn.

Icequeen99

caroll72 wrote: »

I am currently in dispute with HMRC who are demanding repayment of nearly £500 working tax credit for the tax year 2012 - 2013.
During this year, OH & i were in & out of work, due to zero hour contract jobs & agency work.
Each time that work dried up, we signed on for jsa, but we got a 4 week run on, of working tax credits.
However, our jsa was reduced, by the element of tax credits paid each week.
For example: £110 weekly jsa. £35 wtc, meant jsa was reduced to £75 a week.
HMRC are now wanting this money back, but my argument is that we would then have been living on less than the government says is the minimum benefit for a couple.
They're having none of it, & telling me to contact DWP regarding the reduced weekly benefit.
Thought the Inland revenue & DWP worked hand in hand.
At my wits end & don't know which way to turn.

I don't quite understand what you are saying. DWP were right to deduct the WTC from your JSA.

Tax credits are calculated annually - so do you know for sure that the £500 they are asking for back is the four week run-on and that is what caused the overpayment?

IQ

caroll72

The point that i'm trying to make is that our weekly JSA was reduced by the element of WTC. As HMRC are wanting this money back, it means that for the duration of the 4 week run on periods, we would have had less money to live on than what the law allows.

Icequeen99

caroll72 wrote: »

The point that i'm trying to make is that our weekly JSA was reduced by the element of WTC. As HMRC are wanting this money back, it means that for the duration of the 4 week run on periods, we would have had less money to live on than what the law allows.

Yes, I understand that, but given that tax credits awards are annual, how do you know the overpayment occurred due to the 4 week run-on periods?

Do you know the cause of the overpayment?

IQ

caroll72

The cause of the overpayment they say is because we notified them of a increase in our wages, but they didnt reduce our award.
I thought that the award was calculated on the year, as a whole & therefore, the 4 week run ons would have been included, but their letter states that the 4 week run on did not contribute to the overpayment.
They are also telling me to contact the DWP if i'm unhappy that i didnt receive the correct amount of JSA. But how can i do this, as it was 2 years ago, & correspondence from DWP at the time states that my JSA is being reduced because of WTC run on. I'm going around in circles & no one will admit they got it wrong.

Icequeen99

caroll72 wrote: »

The cause of the overpayment they say is because we notified them of a increase in our wages, but they didnt reduce our award.
I thought that the award was calculated on the year, as a whole & therefore, the 4 week run ons would have been included, but their letter states that the 4 week run on did not contribute to the overpayment.
They are also telling me to contact the DWP if i'm unhappy that i didnt receive the correct amount of JSA. But how can i do this, as it was 2 years ago, & correspondence from DWP at the time states that my JSA is being reduced because of WTC run on. I'm going around in circles & no one will admit they got it wrong.

Depending on the amount of your total award, the 4 weeks would make only a small portion of that. A wage increase would impact on the whole award including the 4 week run-on but as I say it is spread out evenly across the year so I doubt much of the overpayment will fall into those 4 weeks.

When you reported the increase in wages - did you check your next award notice and let HMRC know they had made a mistake? If so, then you can dispute the overpayment with HMRC.

IQ

caroll72

Our wage increase didnt last long, we were in & out of work all year with zero hour jobs. I'm trying to take the year as a whole. I think because of our work/signing on situation it has them totally confused.

caroll72

Between HMRC & DWP they have obviously cocked up. Either DWP shouldnt have deducted the amount being paid in WTC, or HMRC shouldnt have given us a run on.

Icequeen99

You may find that that neither of them did anything wrong. You can get tax credit overpayments when income changes even if you tell them at the right time.

And even if HMRC made a mistake and didn't record your income increase, if you didn't check the award notice then there isn't much you can do about it.

DWP won't change your entitlement to JSA now because you did actually receive the WTC during the four week run-on period.

And if you did stop working, then you would be entitled to the 4 week run-on.

But if you later went back into work and had a wage increase, that wage increase could affect the amount you received in an earlier 4 week run-on period because income is spread over the year (even if there was more than one claim in each year).

IQ