Tax credit overpayment disproportionately penalizing

jeancharles

Hello hoping someone can help me with grounds to appeal. I'm disabled and was on a joint working tax credit claim with my partner self employed as a carer and me on a small part-time salary in January 2024 our WTC came to an end we choose not to make an applicantion for Universal credit after receiving the final notice, as I had a second interview for my first full time job in17 years.

I got the job and started well after my WTC ended with my first payment in March 2024. I completed a tax return then in May I received a tax credit notice stating I now owe 1,900 it states my claim ended on 10.01.2024 however my salary after the claim ended has been added to disproportionately inflated my income. I could have continued to claim

Universal credit up to my first payment but did not want to drain the system however I now understand that this may have worsened my situation as I now understand that tax credits despite as far as I knew ended meant my basis for a claim and responsibilities of reporting past termination went. I believe this is grossly unfair because, at the time of my claim, my part-time salary was in real time what I needed. I received no notice that my salary would be included and have not been told how the amount was calculated using what I now understand as a new in-year or end-of-year calculation. Because I did not claim after my WTC ended I have unknowingly reduced the number of days doesn't wtc have a duty to inform you that your claim is not a clean break and ended but in fact continuing as I would have made different decisions as this one-month income artificially inflated my income for the year and aiming to save the benefits system has reduced the days taken into a calculation that they have not shared making it hard to appeal. Can anyone advise what I should do as I used my first payment to pay bills and had no warning that the end was not the end of my benefits. 

peteuk

Had you made the UC application you TC would have had an in year ending.

What you have is an end of tax year ending, So it has taken the amount earnt in the tax yer and recalculated your TC.  At which point it has given you an overpayment.

TC is calculated on your previous tax years wages, this is then sliced into 13 payments.  At the end of the tax year it is recalculated.  At that point if you have earnt too much, it shows ann overpayment and if your income was high enough and you were not elidgable for TC the whole year becomes an overpayment.  

Sadly you were given the choice to switch to UC which you decided not to do, the honest was on you to work out the benefits of doing so, and you sadly choose not to, so therefore have ended up with an TC overpayment. 

My advice is call up and find out a) where/why  the overpayment has occurred and b) what wages have been used to calculate this.  If you started a £12k*per year job in Jan, then it should have picked up only 2 or 3 months wage (at £1K per month) plus what you had previously been paid from April 23 - Dec/Jan 24 (depending on when you started)

I cant see a grounds to dispute this otherwise, unless someone else can correct me.  DWP/HMRC havent made an error.  

If your struggling then they can set up a payment agreement.

(*£12K used for ease as it leads to £1K a month)