Tax Credits Overpayment - Advice Needed Please!!

mimik001

Hi,

  Any advice with the following would be greatly appreciated. I am a disabled man and In 2014 I went self-employed as a musician. I sought advice from Citizens Advice beforehand with regards to claiming Tax Credits and coming off Income Support and Severe Disablement Allowance. I live with my mother, and at the time my partner did not live with us. CA advised me of what I could claim and receive. They didn't advise me that if my partner moved in I would need to claim as a couple.

  Either later that year, or some time the following year my partner moved in with us. She is disabled and unable to work. As I am the only one in the household working (my mother is in her 80s and retired) I thought that I should still be making a single claim. Having mentioned this to friends and family who are also on Tax Credits, they also believed this to be correct.

  October 2022 I receive a letter from HMRC informing me that they believe I may be claiming incorrectly as I may have a partner living with me. I immediately contacted them by telephone and my Tax Credits claim was stopped and I contacted CA for advice with this, and also for advice on claiming Universal Credit.

  Late October 2022 and HMRC write to inform me that they have overpaid me by £3734.93. an amount from another award period of £120.50 was deducted. As was the amount of £17.10 that they say I would have been entitled to during this period. They also send me a form asking for details about my partner, along with a separate page for me to tell them why I think their decision is wrong. Further talks with the CA Tax Credits Support Group ensued. I was advised by them to write a letter to HMRC and ask for 1. A review and detailed calculations, 2. Mandatory Reconsideration and 3. Request that they calculate my entitlement as a couple (which my claim should have been made as) and adjust against the alleged overpayment. I did this,

  November 2022 and HMRC send me an Award Review for the period 06/04/2022 to 06/04/2022 - just a one day period. Apparently this is where the £17.10 comes in. The award also includes the overpayment.

  10th January 2023 I received a letter from HMRC telling me that I 'cannot appeal against an amount we pay after we have made a change to your award. The law that defines this is Section 39 of the Tax Credits Act 2002. This mean that you cannot ask for a mandatory reconsideration of the amount. And we will not take any further action on this matter.'

  16th January 2023 I received another letter from HMRC telling me that they have considered the information I had provided and have checked their records and that the overpayment is correct. It says they will only look at the overpayment again if I have new information to give them, or if I can provide new and relevant evidence to show that they have failed to meet their responsibilities under COP26.

  I just feel like they are telling me that I have every right to appeal this overpayment issue, but that every time I appeal they tell me I have no right to appeal. I am currently awaiting another call from the CA support group to see what advice they might give. But does anybody have any advice, or am I going to have to take this on the chin? Would contacting my MP with a view to them contacting the Ombudsman on my behalf be worth a try?

  I feel a few details about me and my partner may help here. I am 47 years old and disabled. On WTC I was entitled to both the Disability and Severe Disability Elements. My earnings for 2021/22 were £8,303. My partner is 48. She receives Contribution-based ESA and is unable (unfit) for work, and as such has no income from work. Due to her health problems I am now also her carer.

  As I said at the start any advice would be greatly appreciated. I just feel like I'm banging my head against the wall at the minute, This really couldn't have come at a worst time. It was a genuine mistake on my part, but since getting back to work post-Covid my workload has reduced by half, add to that the cost of living rises along with recent health scares with my partner and my mum this is really getting me down.

    Thanks in advance,

          Anthony

sammyjammy

I'm not clear what you are disputing, you claimed as a single person when you shouldn't have (advice from friends and family is no substitute for getting clear professional advice), when you claim tax credits you agreed to tell them about any change of circumstances, you did not do so and as a result have an overpayment, it's as simple as that.  If you had claimed as a couple the Cont ESA would have been taken into account as taxable income.

calcotti

A single person had to make a single claim.
A couple had to claim as a couple. Having a partner move in would end entitlement to a single claim and any payments made as a single claim would automatically be an overpayment. 

A new couple claim would be required.

I can’t see a challenge to the fact that an overpayment has occurred. However it is possible to do ‘notional offsetting’ to compare what you actually received with what you would have received had you made a correct claim as a couple. That may reduce any money owed. From your description it sounds as if they have done this.

it seems very unlikely that we can offer any advice over and above anything that CA are giving you because they obviously have more detail of your case than you are able to post here. Hopefully CA have been to check the offsetting calculations produced by HMRC.

Rubyroobs

Your tax credits claim should have ended when your partner moved in and you should have claimed Uc then. I have no idea why family and friends would tell you that you should be still claiming as single. Any means tested benefits are claimed as a couple.

mimik001

Thanks guys. That's pretty much what I expected. I suppose I'm just grasping at straws. I know I made a mistake, it's just that's it's an expensive one that's come at a tough time. It's also frustrating that, had I realised that I should have changed the claim to a couple I would have been entitled to higher payments.

With regards to Notional Entitlement the latest letter says I am not entitled to it because I didn't change my claim within one month of the change happening.

HillStreetBlues

mimik001 said:

  I feel a few details about me and my partner may help here. I am 47 years old and disabled. On WTC I was entitled to both the Disability and Severe Disability Elements. My earnings for 2021/22 were £8,303. My partner is 48. She receives Contribution-based ESA and is unable (unfit) for work, and as such has no income from work. Due to her health problems I am now also her carer.

Is this being claimed as a couple?

mimik001

HillStreetBlues said:

Is this being claimed as a couple?

No I was incorrectly claiming as a single person (which I genuinely believed was correct)). When I changed the claim my Tex credits stopped and we had to apply for UC. Which is a whole other crazy story…

poppy12345

Which ESA does your partner claim? Is it New style ESA or the old contributions based? If her claim started after Dec 2018 then it would be New style ESA and in this case you won't be able to be included as a partner on this claim because it's a contirbutions based only benefit.

Use a benefits calculator to check entitlement to UC. Your partners ESA and your carers allowance will be deducted in full from any UC entitlement. Their Support Group award will be transferred to UC and they will be entitled to the LCWRA element from the start of your claim.

mimik001

poppy12345 said:

Which ESA does your partner claim? Is it New style ESA or the old contributions based? If her claim started after Dec 2018 then it would be New style ESA and in this case you won't be able to be included as a partner on this claim because it's a contirbutions based only benefit.

Use a benefits calculator to check entitlement to UC. Your partners ESA and your carers allowance will be deducted in full from any UC entitlement. Their Support Group award will be transferred to UC and they will be entitled to the LCWRA element from the start of your claim.

She claims the old contribution-based ESA. After the Tax Credits fiasco we were told we would need to claim UC as a couple. We did this, but they have kept her on the old ESA!! We honestly don't know where we're up to with half of this.

Spoonie_Turtle

mimik001 said:

poppy12345 said:

Which ESA does your partner claim? Is it New style ESA or the old contributions based? If her claim started after Dec 2018 then it would be New style ESA and in this case you won't be able to be included as a partner on this claim because it's a contirbutions based only benefit.

Use a benefits calculator to check entitlement to UC. Your partners ESA and your carers allowance will be deducted in full from any UC entitlement. Their Support Group award will be transferred to UC and they will be entitled to the LCWRA element from the start of your claim.

She claims the old contribution-based ESA. After the Tax Credits fiasco we were told we would need to claim UC as a couple. We did this, but they have kept her on the old ESA!! We honestly don't know where we're up to with half of this.

That's correct, because the contributions-based part is not means-tested.  She'll continue to receive it and the full amount will be deducted from the UC.

If she's in the Support Group you should have been receiving the LCWRA element in your UC from the start of the claim, just so you know to check.

poppy12345

mimik001 said:

poppy12345 said:

Which ESA does your partner claim? Is it New style ESA or the old contributions based? If her claim started after Dec 2018 then it would be New style ESA and in this case you won't be able to be included as a partner on this claim because it's a contirbutions based only benefit.

Use a benefits calculator to check entitlement to UC. Your partners ESA and your carers allowance will be deducted in full from any UC entitlement. Their Support Group award will be transferred to UC and they will be entitled to the LCWRA element from the start of your claim.

She claims the old contribution-based ESA. After the Tax Credits fiasco we were told we would need to claim UC as a couple. We did this, but they have kept her on the old ESA!! We honestly don't know where we're up to with half of this.

As you are working then claiming UC was the correct thing to do (forget you mentioned you work when i previously commented) Diffcult to follow your timeline.

As her ESA is contribution based this will continue as normal but it will be deducted in full from any UC entitlement. She needs to make sure she tells them that she's in the Support Group for ESA so they can transfer her details across (they don't always do this quickly)

When you have your first statement, you need to make sure it includes all the elements you're entitled to... couples standard element (over 25) carers element, LCWRA element and any other elements you're entitled to such as housing element, if you rent your home. Your carers allowance will also be deducted in full from any UC entitlement.

Your first UC payment will be 1 month and 6 days after you submitted your claim.

Any earnings you receive each month will reduce your UC. You will have the work allowance, which means a certain amount of earnings will be disregarded before the 55% deductions apply. If you claim for help with any rent then your work allowance will be £344/month, if you don't it will be £573/month.

Don't forget also that UC is means tested (unlike tax credits)  For every £250 or part there of  over £6,000 your UC will reduce by £4.35/month. For savings/capital of more than £16,000 then entitlement to UC will end.