Had a letter saying we owe £2500 in Tax Credits...

RedfordML

How do we go about repaying this? 

What is frustrating, I always updated promptly, on change of circumstance! So disappointed and worried to get this letter. 

Do we have any option to pay it off monthly, say £50 or less (ideally!) as money is tight! 

What are the next steps - don't want any charges or anything going on our credit scores that could effect future mortgage applications and credit score!! 

Thanks if you can help with advice !

MorningcoffeeIV

They should be receptive to a payment plan, though possibly not as low as £50.

Mortgage lenders don't use credit scores (and neither does anyone else). They use your credit files and nothing should go on those unless you let it progress to a CCJ.

Brie

The most important thing is to not ignore it and discuss a solution.  Most things like this can be repaid over time or be averaged out with tax codes or reduced benefits etc.  

There is no reason for there to be any charges (put on the house?) if you come to an agreement and credit scores are meaningless.  Any bank will look at your credit history and if you are using the same bank as your "old" mortgage or where you have any current/savings accounts they will also look at how you have run those.  No defaults or late payments?  No problem.  

ProDave

I had this a few years ago because they were shockingly poor at updating what they paid when your circumstances changes that they had over payed while they worked it out.

The only way I found to pay it was wait about an hour on the phone to eventually get to speak to someone.  Shockingly poor system, no way to contact them otherwise.

At least there were no charges for the overpayment, so we just treated it as an interest free loan.

RedfordML

ProDave said:

I had this a few years ago because they were shockingly poor at updating what they paid when your circumstances changes that they had over payed while they worked it out.

The only way I found to pay it was wait about an hour on the phone to eventually get to speak to someone.  Shockingly poor system, no way to contact them otherwise.

At least there were no charges for the overpayment, so we just treated it as an interest free loan.

Did you manage to set up a monthly payment plan (minimal amount) or pay in one payment? We can't afford to pay in one lump sum! 

The system is shocking - like you say its long calls or paperwork through the door without the updates given! 

poppy12345

You should be able to arrange a repayment plan without any issues. You will just need to contact them, though i do understand that may not be easy.

peteuk

Are you still claiming TC? If so they usually take it from the next years payment.  If your not then as advised phone and agree a payment plan.  It can be at any cost (mine is £25 a month for a similar amount…yep it’s going to take 8yrs to pay back.