Tax Credit Overpayment Help!!

sunflower80

Apologies up front but this is a bit long winded.

When my daughter was born in May 2008, we applied for tax credits. Forms all went through and I then saw a payment of just over £2k had gone into my bank account and also received a letter stating my entitlement. This seemed rather high so I phoned to query it a couple of times but was told it was all correct. Then on a third phone call, the adviser spotted that they had only used my salary and not my husbands in the calculations (despite me putting both salaries on the form).

She said she could send me a form with details of returning the £2k in full or the overpayment could be offset against future payments, so I opted for the latter.

We received no further payments and at the end of the following year, we received a letter stating we owed about £100 in overpayments which we repaid immediately and assumed that we were all square.

We did not renew our claim after this as my husband had gone from the 4 day short week he was put on during the recession back to full time so we had already worked out that we would no longer be entitled to anything.

Then in 2012 (3 years later) I received a letter stating that we still owed this £2k despite having not received any more payments or communication from them. I rang to challenge this as I did not make any mistakes, I fully disclosed both salaries on the initial application and when I was informed of the £100 overpayment, repaid it immediately. Having read that you may not have to repay overpayments if it was their mistake I asked for copies of my original forms so I could prove I had stated both salaries. Yet I never received these or any further communication from them.

Another year and a half passed and then my husband received a letter stating that his income tax code was going to be adjusted to recover this £2k overpayment. We went through the letters and phone calls again, trying to challenge this but once again come up against unhelpful and to be perfectly honest pretty useless and clueless staff at HMRC and again, no response to our letters. At that point, we just gave up and thought, if they're going to do it this way, there's clearly not much we can do and to just let them have the money back. My husband changed jobs around this time, his tax code did change and so again, we thought it was all dealt with.

Again, another year and a half has passed and we received a letter this morning stating that we have still not repaid this £2k and if we don't make full payment immediately it will be passed to a debt collection agency.

We rang them straight away and were told that despite receiving that letter informing us of the amendment to my husbands tax code, they (apparently) never actually did it so we still owe the money!!! We have no clue on how our ridiculous tax system works so are unsure on how to check if his new tax code was taking account of this or not.

And more to the point, should we still have to repay this money almost 7 years later when at every stage, it has been them making the mistakes and not communicating with us in a timely manner or responding to hardly any of our communication to them?

Any help or advice would greatly appreciated!

bylromarha

Sorry, unable to help more than link you to Martin's page on this. There is info on overpayments if you scroll down.

We had this hell 2004-2010. We'd been overpaid, then underpaid, then overpaid, then underpaid. I asked them to stop paying me until the debt was cleared, and they refused. They were a pain in the backside. YOu keep them as informed as they want you too, and still they can't do their job properly.

All the best trying to get it sorted.

Icequeen99

sunflower80 wrote: »

Apologies up front but this is a bit long winded.

When my daughter was born in May 2008, we applied for tax credits. Forms all went through and I then saw a payment of just over £2k had gone into my bank account and also received a letter stating my entitlement. This seemed rather high so I phoned to query it a couple of times but was told it was all correct. Then on a third phone call, the adviser spotted that they had only used my salary and not my husbands in the calculations (despite me putting both salaries on the form).

She said she could send me a form with details of returning the £2k in full or the overpayment could be offset against future payments, so I opted for the latter.

We received no further payments and at the end of the following year, we received a letter stating we owed about £100 in overpayments which we repaid immediately and assumed that we were all square.

We did not renew our claim after this as my husband had gone from the 4 day short week he was put on during the recession back to full time so we had already worked out that we would no longer be entitled to anything.

Then in 2012 (3 years later) I received a letter stating that we still owed this £2k despite having not received any more payments or communication from them. I rang to challenge this as I did not make any mistakes, I fully disclosed both salaries on the initial application and when I was informed of the £100 overpayment, repaid it immediately. Having read that you may not have to repay overpayments if it was their mistake I asked for copies of my original forms so I could prove I had stated both salaries. Yet I never received these or any further communication from them.

Another year and a half passed and then my husband received a letter stating that his income tax code was going to be adjusted to recover this £2k overpayment. We went through the letters and phone calls again, trying to challenge this but once again come up against unhelpful and to be perfectly honest pretty useless and clueless staff at HMRC and again, no response to our letters. At that point, we just gave up and thought, if they're going to do it this way, there's clearly not much we can do and to just let them have the money back. My husband changed jobs around this time, his tax code did change and so again, we thought it was all dealt with.

Again, another year and a half has passed and we received a letter this morning stating that we have still not repaid this £2k and if we don't make full payment immediately it will be passed to a debt collection agency.

We rang them straight away and were told that despite receiving that letter informing us of the amendment to my husbands tax code, they (apparently) never actually did it so we still owe the money!!! We have no clue on how our ridiculous tax system works so are unsure on how to check if his new tax code was taking account of this or not.

And more to the point, should we still have to repay this money almost 7 years later when at every stage, it has been them making the mistakes and not communicating with us in a timely manner or responding to hardly any of our communication to them?

Any help or advice would greatly appreciated!

Unfortunately, yes you do need to pay it back. You will need to talk to them and agree a monthly repayment. If you wanted to dispute the overpayment then you should have done so when you were told about it. It sounds like you accepted the overpayment and were happy to pay it back originally.

Of course, if you say you have already paid it back and you can prove that then you will be able to do something about it.

IQ

Gaye22

Hi Sunflower, I can't be certain but I suspect part of the issue is that despite not renewing, you may have failed to provide HMRC TC with the information to finalise your award for that year. This is simpy my summizing however I would not hesitate to contact DMB and dispute the overpayment - you have already paid it as they ceased your payments! In the meantime ask for the assistance of your MP, providing copies of everything you have. I do not pretend to be an expert in these matters, but I would strongly suggest you fight this. The error is theirs, not yours. They advised you they would be amending your husband's tax code. Your MP can assist in ensuring that you are not penalised any further for their shortcomings. Unfortunately the staff at HMRC tax credits are extremely helpful, but they have limited access and cannot see everything on the system, which I have discovered on my own journey. Good luck, and please do refuse to pay this bill. HMRC make mistakes, but they will never pay you back if they realise it.