Child Tax Credit Overpayment

LittleMissMolly_2

I think I've done all that I can, so this is more a rant than anything, but if someone who knows the system could cast a quick eye over this and advise, then I would be extremely grateful!

My daughter and her partner both work and claim CTC. They are absolutely punctilious about immediately reporting every single change in circumstances - and there are a lot as son in law is self employed, so monthly income varies considerably. Anyway - long story short - in December their CTC payments stopped without warning and, on ringing to query, they were informed that they had been overpaid by £1000 in this financial year and that this over-payment was being clawed back immediately by stopping all further payments for the rest of this financial year (until 1st April 2016).

Bewildered by where the over-payment had come from (all information on received Award notices was correct), we asked for an explanation. The answer, apparently, is that a previous childminder was randomly and incorrectly added to the claim by HMRC.

It's taken us nearly a month to get that answer and, as usual, no further figures have been provided and the over-payment still has to be paid back - leaving no CTC for three months with childcare costs still having to be paid during that period if my daughter is to continue working. The Award notice showing the over-payment finally arrived on Monday of this week. I am therefore having to pay for the childcare for one child (£65 per week) whilst the children's paternal grandparents pay for the childcare for the second child at £31 per week. Neither of us can really afford to do so, but needs must

So ... we have raised a dispute against the over-payment, plus an appeal against the decision which led to it happening (on the grounds that it is an Official Error). We have also submitted a SAR request, in the hope that it will enable us to submit new information when the dispute and appeal are refused (which I'm sure they inevitably will be - HMRC being the way that they are :mad: ). All have been posted today by recorded, signed for, delivery. Is there anything else that we should be doing at this point?

I'm not really expecting it all to yield results, but I'm just so angry about how unfit for purpose the CTC is, and how unaccountable HMRC are, that I want to make a point - even if it's just inconveniencing them as much as I can. This is a ridiculous system that just pushes people who are already, by virtue of being eligible to claim, struggling to make ends meet into debt :mad:

prosaver

citizen advice best bet.
i got stung too have to pay back 12 a week ddebit.
cant u do it that way and stil get tcredits?

LittleMissMolly_2

Apparently not. HMRC's current policy is that it has to be repaid within the current tax year and, if the claimant(s) are still eligible for CTC, they will simply remove it from due payments until it's repaid - regardless of whatever financial situation that leaves the family in.

Darksparkle

So if some random childcare provider was added in error, would this not have increased the payments your daughter and partner received?

If the payments did increase at some point, did they notice it and question why?

Did they receive any award notice advising that a change was made to their record?

From what you have said, I do not see an appeal being of help. But the dispute would be the correct action.

An appeal is appropriate where they think tax credits made the wrong decision about a claim eg
- a single person claiming is told the should be claiming as a couple
- trying to claim the disability element and being told they do not qualify
- not meeting the criteria for claiming as self employed etc

A dispute is where the claim is correct, but that an error has caused an overpayment to occur. Which sounds like the case here.

Darksparkle

prosaver wrote: »

citizen advice best bet.
i got stung too have to pay back 12 a week ddebit.
cant u do it that way and stil get tcredits?

If the claim has already been overpaid earlier in the heat, any further money will just increase the overpayment.

Perhaps the circumstance you are thinking of is where the overpayment is for earlier years, they then take a % back from future payments.

prosaver

LittleMissMolly wrote: »

Apparently not. HMRC's current policy is that it has to be repaid within the current tax year and, if the claimant(s) are still eligible for CTC, they will simply remove it from due payments until it's repaid - regardless of whatever financial situation that leaves the family in.

sounds true
cant you get aloan and pay back 12 pound a week

LittleMissMolly_2

Unfortunately HMRC added in the non existent childcare provider at the same time as they processed a different change in circumstances, so a change in payment amounts was expected anyway.

If it had just been a random and unexpected increase in payment amount - with or without a corresponding Award Notice - then it would have been spotted and queried, but it was hidden behind an expected change.

Taking out a loan to pay back a non interest attracting debt (albeit over a longer period), is not a sound financial move imho. We will all just muck in as a (extended) family and struggle through - but it does scare me that this happens so easily and that it could easily happen again :-(

LittleMissMolly_2

I should have said ... it wasn't a completely random childcare provider who is unknown to us. It was a childminder who had previously been on the claim (before the youngest child got her place at the local nursery). This childminder was removed from the claim last June and then re-added by HMRC in a random fashion (ie without reason or instruction).

I know that the appeal is probably incorrect for the circumstances, but decided to launch it anyway on a 'just in case' basis, to avoid falling foul of the 30 day deadline. It's a bit of a belt and braces/ scattergun approach, but I reasoned that it would be better than not appealing and then discovering that I should have done when it was too late.

Icequeen99

Really, this sounds like a dispute rather than an appeal.

There is nothing to appeal, as it sounds like the HMRC decision is right.

In terms of the dispute, i think the most crucial question is whether an award notice was received at the time the change was made.

You said above that they didn't notice the change in payments because another change was reported at the same time the childcare provider was added back on. So I have two questions:

1. What was the other change?
2. Was an award notice issued after this and did they check it? If so, did they notify HMRC within 30 days the childcare costs were wrong?

If there was an award notice that showed the extra childcare amount then unfortunately I can't see any grounds for dispute if they failed to tell HMRC about the mistake.

IQ

LittleMissMolly_2

The other change(s) was/were complicated ... My daughter finished her previous job (the one where she used the previous childminder) in June, then did 3 weeks in her new job, but as a casual.

Because her new job was in a school (and thus term time only), but her permanent contract didn't start until September, CTC wouldn't cover the childcare for the younger child for those 3 weeks (too short a period), so family members juggled annual leave and contracted hours to cover it. Then came the 6 week summer holidays, where she was dealing with Concentrix for some reason. During that time CTC payments dropped because, although she wasn't working or being paid (now she is permanent her salary is averaged out over 12 months), there were no childcare payments at all. So that was a total of 9 weeks without childcare being needed or paid for the youngest and 3 weeks of 'round the clock club' for the eldest and 6 weeks not needed or paid for him during the summer break.

When she started her new job permanently, she informed them of pay and childcare arrangements/costs immediately (they wouldn't accept details in advance - she did try) and eventually, in October, CTC started to pay £160 per week. The Award showed what appeared to be the correct amount of childcare costs (it doesn't identify individual providers) and all other details are correct as well. However because of the whole term time/ holiday situation in respect of childcare, it's not as clear cut as it could be (she was told on the telephone that they average it out). This is the award that CTC are claiming is the source of the over-payment, but we only have their word for it, until the SAR request is fulfilled, as they are being extremely vague about it and every person spoken to gives a slightly different version.

It's as clear as mud unfortunately - hopefully the SAR information will provide some clarity, but we couldn't afford to wait for that before filing dispute/ appeal because of the time constraints, which is why we went ahead with those now.

Icequeen99

So if I understand it correctly HMRC had costs as £160 a week when they should have been just over £90 (based on your first post) is that correct?

I understand averaging is complicated but did your daughter check with them when she saw the £160 and ask for an explanation given that it is quite a bit higher than her childcare costs?

Unfortunately I think you may struggle with this as the first thing you need to do is show that you checked all figures and told HMRC of any that were incorrect and that includes checking the childcare figure.

IQ