Tax credit debacle - hmrc input error & supposed overpayment nightmare

raynessupreme

I have signed up to this forum in order to gain opinions, options and advice. I hope you can help me...

A brief synopsis of our situation - myself working full time (37.5 hours per week), pulling approximately £16,500 a year after tax before any overtime. Partner at home with two boys, aged ten and two. My partner was working 16 hours per week and gathering overtime, but I will explain that later.

*Deep Breath* Let me start at the beginning of our situation...

2016 renewal time earlier this year (end of June). We keep getting text messages to renew our tax credit award saying we can renew online. Marvelous, sounds a lot easier than mucking about with pen and paper. Me and my partner log in using our given details and click a few links. It comes up saying we don't need to amend anything and our award will automatically be renewed with our current information being correct. Great.

Mid-Late July. Still nothing confirming our visit to the website (I screen captured the reference screen stating our renewal had gone through), no paperwork through the door, still being bombarded with text messages. We phone up to find HMRC have no record of our online renewal attempt and we do a renewal over the phone. They take figures and details from us and the job is done, albeit very long-winded as the lady on the end of the telephone didn't seem to know what she was doing in all honesty. But, it was done.

Renewal paperwork comes through the door for the new tax year. Not one bit of our financial situation has changed since last years claim as we always kept them up to date. Instead we get the confirmation with a drop of over £32 a week from our previous award and an obscene claim of overpayment from HMRC of £1,800. We cannot figure why this is whatsoever. We struggle on regardless, unfortunately it has taken its toll and we have suffered hardship to the point that my partner had to leave her employment due to stress and worry as well as being unable to afford childcare costs (this was the summer holiday after all).

We telephone HMRC to update our records with them and simultaneously we receive another letter from HMRC stating we owe them a further £550 with no explanation, no breakdown. Just a threat of repayment or debt collection. We explain this to the gentlemen on the telephone and to our utter shock and disgust they have input my annual income incorrectly to an obscene amount, according to the HMRC I earned £172,000! Yes, that is correct. A HUNDRED AND SEVENTY-TWO THOUSAND POUNDS. The correct figure was of course £17,000. But because the lady on the phone in July made a monumental administration error, it has caused us endless stress and hardship since.

Fast-forward to today. I have since spoken further with HMRC twice, the first person I spoke with of a morning spoke a load of jargon, spoke quickly and tried to palm me off claiming the information I inputted on the website in July was my error. The truth of the matter was that the lady on the end of the phone at the HMRC had inputted that information in incorrectly and not myself (I had attempted an online renewal in June). I ended the call feeling incredibly deflated and that I wasn't getting anywhere. I then telephoned back a few hours later and spoke with a different gentlemen. This person was a lot more helpful and I got more sense out of him. It would seem that because the award is already in effect it cannot be easily amended and they wish to reclaim the money we have supposedly been overpaid over the course of this financial year before they can give us our correct award, which of course we haven't been overpaid anything in the slightest. Their administration error is the reason of all this. So in order to get ourselves back on our feet, we have to struggle until April 2017. I am not pleased.

So it seems we are stuck in some major catch 22 situation somewhat. Some of the HMRC staff I have spoken with admit it is their administration error whilst others attempt to palm the error off on myself and my partner, which is not the case. I have written three letters, all of which have been sent off recorded delivery in an attempt to dispute all of this debacle and have our award rectified correctly in immediate effect and an apology for their cause of hardship given. Plus today I have been in contact with my local MP's office in an attempt to get this dire situation rectified ASAP with the weight of their authority. We have since lost £80 per week from our previous award to our current one since speaking on the phone to the HMRC in an attempt to sort this dire mess out and we really are struggling. Is there anything else I can do and can I go down the road of claiming a compensation of negligence against the HMRC somewhat?

Any advice is duly considered. I can only apologise if my rambling makes little sense but I am a tad miffed to say the least (putting it politely). Has anyone had a similar situation this year and would anyone know if Concentrix has anything to do with this at all? Thank you.

Shaun.

Icequeen99

What is the date on your final award notice for 2015/16?

Is the income error showing on that final award notice?

IQ

Bananas777

Surely if they thought your income was £172,000 you wouldn't then qualify for tax credits and it would have been stopped? It sounds from the overpayment amounts you mention something else is amiss. However I'm sorry to hear about what has happened. I take it is states in the award letter this figure- so did you call them when you got the award letter and change it?

raynessupreme

Unfortunately I did merely glance at the renewal paperwork when it came through the door and only realised the administration error when disputing the overpayment over the telephone when the HMRC call handler came back off hold and realised where things had gone awry. Then did I properly look at the figure written of 172068, Which which should read 17268 I realised where things had gone wrong. I will certainly be more vigiliant in future. Because this dispute is within the three month time window for renewal claims I am certainly hoping our situation is still in chance of a case being heard and settled in our favour.

raynessupreme

A quick glance shows the letter for the award renewal is dated 27/07/16.

Icequeen99

raynessupreme wrote: »

A quick glance shows the letter for the award renewal is dated 27/07/16.

A dispute is not what you should be doing here unfortunately. You need to use the appeal route.

You normally have 30 days to appeal from the date on the award notice (27/07/16). As you have missed this then you would need to request a late appeal but HMRC don't have to accept the late appeal.

Do you remember what date you first queried it (disputed over the phone)? If that was within 30 days it might help your late appeal application.

In my experience HMRC will not correct this through a dispute or write off the overpayment because the test they apply means you failed to meet your responsibilities (because you didn't check the award notice).

The onus really is on the claimant to carefully check award notices for this very reason.

Edited to add: I agree with the poster above - if you are still getting payments the 172k error doesn't make sense unless they have now updated your current year estimate

IQ

WestonDave

There was me thinking that the reason I spent ages updating our work payroll systems was so that HMRC would have real time pay data for the last two years to enable quick accurate assessments of tax credit awards. It beggars belief that in 2016 one half of HMRC's computer system that collects taxable income data can't flag a massively out of kilter income figure on the tax credits system for checking before action is taken. An income of £172k on the tax credits system should automatically flag as an error and insist on manual checking back with the claimant before anything automatic is generated simple because that level of annual income is extremely rare in society generally let alone within the claimant population.

Sorry OP - doesn't help you but you have my utmost sympathy at having to fight this stupidity!

raynessupreme

I have been on the phone with them the last seven days and have written letters sent and received in the last three weeks stating I wish to amend this. I wasn't aware that the words dispute and appeal had separate meanings here as I thought they were one and the same. Here's still to hoping things work out for us. I was pondering that as I read your reply too as my mother is an accountant for a local town council and she has said about RTI when it comes to CRB disclosures and whatnot, you would think such a colossal error would flag up immediately? Sometimes I think the administration is done by dumb machines giving estimates rather than someone sitting down with a formula to sort out your individual claim.

Icequeen99

raynessupreme wrote: »

I have been on the phone with them the last seven days and have written letters sent and received in the last three weeks stating I wish to amend this. I wasn't aware that the words dispute and appeal had separate meanings here as I thought they were one and the same. Here's still to hoping things work out for us. I was pondering that as I read your reply too as my mother is an accountant for a local town council and she has said about RTI when it comes to CRB disclosures and whatnot, you would think such a colossal error would flag up immediately? Sometimes I think the administration is done by dumb machines giving estimates rather than someone sitting down with a formula to sort out your individual claim.

Yes - appeals and disputes are very different. You need to get that appeal filed as soon as possible.

IQ

Darksparkle

I can understand your frustration here but adding an extra zero is an easy mistake to make. Human error is unavoidable, this is why they send you the awards notice and ask you to check it.

IQs advice is correct though, an appeal is what is needed here. You can find be relevant forms on the gov site.

An appeal is where you disagree with eh decision they have made because you believe they are using the incorrect information (another would be they believe you should claim as a couple but you are claiming as a single person).

An overpayment is when you agree the overpayment is correct but do not believe you should repay as it is not your error for example you reported a decrease in childcare costs and they failed to action it with a reasonable time causing you to receive more than you are entitled to.