We use cookies to collect information about how you use GOV. We use this information to make the website work as well as possible and improve government services. You can change your cookie settings at any time. This leaflet explains why overpayments happen and how to pay them back. It also tells you when you do not have to pay them back and how to dispute an overpayment. PDF , KB , 20 pages.

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COP 26 What happens if we've paid you too much tax credit? See Codes of Practice below. Overpayments are formally identified after the end of the tax year when claimants finalise their claim for the previous year and we check the amount due against the amount paid.

We aim to pay the right amount over the year so claimants are not under or overpaid. However, there are several reasons why we might find, after the end of the year, that a claimant has been paid too much tax credits, including, for example, where:.

If, when we finalise an award of tax credits, we identify that entitlement to tax credits should have stopped in the previous tax year, any provisional payments made in the current tax year will be recoverable. This means there may be an overpayment for both the previous tax year and the current tax year.

Our approach to recovering overpayments is described in Code of Practice 26 COP 26 , What happens if we have paid you too much tax credit? You can refer to this at [ www. Alternatively, claimants can pay us back straight away if they wish, by sending a personal cheque to:. We will recover an overpayment direct from the claimant if they do not have any current entitlement to tax credits or if their award for the current year has ended. This includes:.

We will issue a Notice to Pay TC The notice advises claimants that payment should be made within 30 days of the issue of the notice and contains a payslip. For overpayments arising in —04 and —05, claimants can pay by 12 monthly instalments if they wish. To do this, they should contact the Payment Helpline on If we do not hear from the claimant, and an overpayment is unpaid 30 days after the issue of the Notice to Pay, we will take recovery action.

We will phone or write to the claimant and, depending on the outcome of the contact, we may start legal proceedings. When making a joint claim for tax credits, both claimants are required to sign the form and so take responsibility for the information on the claim.

If one of the claimants cannot, or will not, pay then the other claimant is liable to pay the full amount overpaid. Claimants have a statutory right of appeal against our decision about their entitlement to tax credits. Any appeal must be made in writing to the Tax Credit Office within 30 days from the date on which a notice is issued.

There is no right of appeal against the recovery of an overpayment; however, claimants may ask us to re-consider whether they ought to be asked to repay their overpayment, or to vary the rate or method of recovery, in line with COP After considering the facts in individual cases, we may decide not to collect all or part of an overpayment, or to allow the claimant more time to pay, if payment would cause them and their family hardship.

We will look at each individual case sympathetically in line with the factors set out in COP Where an overpayment arises as a result of our mistake we will not ask for it back if the claimant could reasonably have thought their award was right. If a claimant does not agree that they should have to repay an overpayment of tax credits, they need to set out their reasons in writing. They can use Form TC, Request to reconsider recovery of tax credits, which is available on our website at [ www.

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Tax credits: what happens if you've been paid too much (COP26)

We use cookies to collect information about how you use GOV. We use this information to make the website work as well as possible and improve government services. You can change your cookie settings at any time. Use the online form if HMRC has paid you too much tax credits and you think you should not have to pay it back. You must be able to show that HMRC made a mistake, or gave you incorrect advice, and it was reasonable for you to think your payments were right. Read Tax credits: appeals and complaints before filling in the form to make sure you can dispute your tax credit overpayment.





Tax credits: dispute recovery of an overpayment (TC846)




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