Tax credit overpayment

lowline

Hi, 
I recently changed from Tax Credits to UC after getting my migration letter.  I was always afraid to switch due to the delay in getting money.  However I was surprised to learn I was entitled to double the amount I was getting with TC.  TC have now asked for pretty much all of what they had given me last year due to over payments.  I cant understand how this is all goverment money which they have worked out I was clearly not getting enough to live on with TC hence doubling my amount on UC but now state they want the money back from TC ? How can this be right?

peteuk

Because tax credits is calculated on a yearly sum and then decided by 13 payments, if at any point you dont fit the criteria for TC then you are liable for the whole payment to be an over payment.  Which they will start taking back from. Your UC.

First thing is phone them, find out what has caused the overpayment in the first place. Try and do this calmly and with someone with you.  That way if you miss any details the other person can help.  Once you know the reason why then you can address it.

For me TC has always been designed to fail, taking an estimate or last years earnings and giving you a years payment and then checking the calculations at the end of the tax year.

Good luck. 

sheramber

Do you pay rent? 

UC  include rent payments when working out your claim.
Tax Credit did not give any payment towards rent.

lowline

Yes I do pay rent. 

kaMelo

You haven't really given us much to go on in your posts. Did you receive housing benefit while on tax credits? 

If you did you would need to add this to any tax credits you received to make a fair comparison. If not this may go some way to explain why UC is paying more as it includes a rent element you were not previously receiving.

With regard to your tax credit overpayment, tax credits are an annual award split across 13 payments. If for any reason your circumstances change to affect that award then the whole year can become an overpayment, maybe this was flagged up by your in year finalisation.

What were your actual circumstances used for the in year finalisation compared to those they based the initial award on? .