Working Tax Credits Overpayment

hodgeyboy_2

Hi everyone,
I’m looking for any advice on a working tax credits overpayment issue.
My partner was getting Working Tax credits at the full amount due to earning under £6000 previous to the tax year 2017, living as a lone parent of two children.
She then started a job as a Nurse in May 2017 starting on a salary of £22000 and notified HM revenue &Customs of the change at the end of her first month of employment.
It wasn’t until yesterday that I saw an amendment notice from January 2018, and realised that they have been working out her tax credits from her previous salary from 2016/2017 and have still been paying her tax credits at the full amount based on this.
We are planning on moving in together in April and getting married, hence my going through our incomings and outgoings.
After a phone call to HM Revenue, she was told that she owes £5000 in overpayments. And that it is her fault, because they should have sent an amendment notice around June 2017 which should have flagged up that the income her tax credits were/are based on is incorrect.
She never received an amendment at the time, and the reason why she received an amendment notice in a January 2018 is because she notified them that she had dropped her full time hours down to 35 from 40+.

Could anyone offer any advice on how to deal with this situation? I’m aware that overpayments need to be paid back, and that there are rights to dispute, if the payee notices that things are wrong. However obviously, nearly a year of overpayments before it is flagged is problematic.

Surely HM Revenue & Customs should have seen something was wrong during this period?

Any help is very much appreciated!

Thank you.

System

she would have been aware that she was being overpaid. she should have rang them again and let them know what her salary was. the letters all say based on xxxx year income. tax credits is only not affected if income change +/- £2500 on the next year. other than that you always owe them money.

Icequeen99

hodgeyboy wrote: »

Hi everyone,
I’m looking for any advice on a working tax credits overpayment issue.
My partner was getting Working Tax credits at the full amount due to earning under £6000 previous to the tax year 2017, living as a lone parent of two children.
She then started a job as a Nurse in May 2017 starting on a salary of £22000 and notified HM revenue &Customs of the change at the end of her first month of employment.
It wasn’t until yesterday that I saw an amendment notice from January 2018, and realised that they have been working out her tax credits from her previous salary from 2016/2017 and have still been paying her tax credits at the full amount based on this.
We are planning on moving in together in April and getting married, hence my going through our incomings and outgoings.
After a phone call to HM Revenue, she was told that she owes £5000 in overpayments. And that it is her fault, because they should have sent an amendment notice around June 2017 which should have flagged up that the income her tax credits were/are based on is incorrect.
She never received an amendment at the time, and the reason why she received an amendment notice in a January 2018 is because she notified them that she had dropped her full time hours down to 35 from 40+.

Could anyone offer any advice on how to deal with this situation? I’m aware that overpayments need to be paid back, and that there are rights to dispute, if the payee notices that things are wrong. However obviously, nearly a year of overpayments before it is flagged is problematic.

Surely HM Revenue & Customs should have seen something was wrong during this period?

Any help is very much appreciated!

Thank you.

ONe of the things you need to do is contact them if you don't receive an amended notice. Did she not expect her payments to fall when she informed them of a £14k increase in salary? Did she contact them when nothing changed on her award after telling them?

The first thing to establish is whether HMRC say they sent out an amended notice in June. If they say they did - what did they change that led to the amended notice?

However it is likely they will say the responsibility passed to the claimant to contact them when no notice was received.

IQ

hodgeyboy_2

They say that they didn’t send out an amendment notice.
I personally am aware that when you receive an amendment notice that you need to look at it with a fine comb.
Unfortunately my partner thought that the income that the notice said the benefits were based on (being Just less than £6000) was what they were still going to pay her in tax credits.
I understand that she will have to pay the money back. I’m not looking for a way out of paying.
All I’m concerned with is that they didn’t amend it at the time and it has now added up.
Does she have any rights on how to pay it back? Rather than them just asking for the whole amount?

System

yes theyll deduct it from her future payments either weekly or monthly however she is paid. she will still get some tax credits but the payments will be a lot lower to take back the overpayment. if she's struggling when they are taking it back she can call them and ask for the recovery amount to be reduced.

hodgeyboy_2

Unfortunately she was unaware that this was wrong until I noticed it. That doesn’t mean it’s an excuse. I’m just looking for advice on the best way to rectify the situation.

Icequeen99

hodgeyboy wrote: »

Unfortunately she was unaware that this was wrong until I noticed it. That doesn’t mean it’s an excuse. I’m just looking for advice on the best way to rectify the situation.

They will reduce her payments going forward or stop them to start recovering the money. However her claim will end when you move in together and at that point the debt will become directly repayable and you will need to try and set up an arrangement to repay it.

You can try and dispute it but COP 26 (the document which explains how disputes are handled) says:

We’ll send you a corrected award notice if you tell us anything is
wrong, missing or incomplete. If you don’t get an award notice
within 30 days of telling us about a change in circumstance, let
us know as soon as possible.

I have successfully argued disputes where people have not received an award notice, but that has been in their first year of tax credits. I think when someone has been in the system a while they know they get an award notice when changes are reported and also I don't think it is reasonable to think that salary would go up £!4k without at impact on tax credits and for those reasons I think a dispute will fail. That said you have nothing to lose by putting one in.

IQ