To think this is DISGRACEFUL! Massive tax credits overpayment!

[CrumblingKnees]

Just furious that common sense is not prevailing and I am essentially being robbed of money by HMRC!

So, twin DC finished education in summer 2021. Both have a disability, DH works but we were entitled to tax credits as wage not massive and we got the higher rate due to disability. I remember getting a letter saying tax credits would stop from August 31st due to this. Was aware and knew I’d have to find a job to cover the shortfall.

Payments stopped and I then started working in November 2021. I do remember getting some letters from them but ignored as as far as I was concerned claim had ended (stupid I know). Youngest was diagnosed with a serious illness last summer and I’ve been a bit of a mess, not keeping on top of things like I normally am.

Anyway got a letter from them a few weeks ago saying we’d been overpaid almost £2,000! Shocked, rang and basically they’d added on my work income from November onwards to my tax credit claim for that year (it was not closed). I assumed claim had ended in August and if it had been there would be no overpayment!

I’ve explained this and filed a dispute. They’ve come back today and said that as I didn’t dispute before the end of Jan the overpayment stands and we need to pay it!

AIBU to think this is a pisstake and totally wrong for a government agency to take money from families like this?

I also got fined for using tax credit nhs exemption which had expired but they don’t tell you. I had never realised the nhs costs exemption was based on annual earnings. Just assumed it was tax credit linked as I started receiving the exemption when o was eligible for tax credits. It wasn’t clearly explained anywhere. They used to send a card to carry round them stopped and issue a paper letter. No one asks to see the letter, i tried showing it a few times and was told not to bother. As with most I filed it away and it hadn’t dawned on me that the next one hadn’t come. Basically I’d done a day overtime at work about 6 months earlier which had taken me £20 over the annual earnings for exemption and the next exemption certificate was never sent. I didn’t know until I received the letter that it was based on earnings whilst on TCS. Have had to pay the fine and the cost of the treatment and prescriptions I had claimed to be free. I really regret working that day overtime now and basically have lost any incentive to work additional hours as I’m not better off for it - that day also cost me an extra day child care and the stress that goes with an extra day working in general.

They had paid her because they had predicted her payments based on the income at the April based on previous year p60. But as she started work in the November that increased her overall earning for the tax year. They recalculated it the following tax year when p60s were in again which showed she had earned more over the year than they predicted so had paid her more that she was entitled to.

for example - annual earning £1000 so you get £50 a month tax credit. If your earning is over that they would pay you less. In the April they predicted her to earn £1000 so paid her £50. But as she started earning from nov - April she increased the annual p60 to be £1500 which slashed how much she was entitled to. But they had already paid this so she has to replay.

It’s a totally stupid system. Because you are being given money based on a prediction and sometimes people’s circumstances change.

They worked out what she was due each month based on income for the year April to April based on her earning nothing. They stopped paying in August as her children left education so she was no longer eligible. She then started working in November meaning their calculations of what she was due when they did make payments from April to August were wrong and they had overpaid her. They couldn't know this until she started working. Once they knew the amounts they had paid previously were too much they wrote to OP she ignored the letters until it was passed the date to appeal the decision but it wouldn't matter anyway because any appeal would be rejected as no mistake was made. OP has had more money in the tax year April to April than she was entitles to and therefore has to pay it back.

@CrumblingKnees
Do they include all income for a full financial year and work out the payments from that?
If that is the case then they'll have added your income from November to April.

That doesn't seem right though, as I thought they calculated the payments on the previous years income.

I would find some place that has experience in dealing with tax credits.
It certainly seems to be unfair.

It was about 19 years ago because I was recieveing it. It is for low income families only

Calculate your total salaried family income for the entire tax year(Apr 2022/Mar 2023) and compare it to 2021/2022 figure. if it has increased by less than £2500 vs last year's figure, you might have case for appeal.

Look up full info on income disregard here: revenuebenefits.org.uk/tax-credits/guidance/how-do-tax-credits-work/understanding-the-disregard/

Here's an extract from the above:

For income rises – income disregard £2,500

(a) If current year income (CYI) is greater than previous year income (PYI) by no more than a certain amount (known as an income disregard, the final award is based on PYI;

(b) If CYI is greater than PYI by more than the specified income disregard, the final award is based on CYI less the income disregard, and an overpayment may arise.

Thanks for people explaining it to me my god what a confusing benefit.😮

similar happened to me.

I cancelled my claim when I got a promotion as although I was still entitled to claim I could actually manage on the money I was earning without claiming.

Then 4 months later my entire office got made redundant. No drama I found another job and got a bit of redundancy pay to cover the month gap between jobs… but then my redundancy pay increased my earnings for that tax year so I had to pay back £1500 even though I wasn’t claiming any longer and was entitled to what I was being paid at the time. It’s rubbish OP as the system can make you feel like you’re being punished for trying to move forward with life and whenever you talk to them you just go round and round in circles. Sending hugs!

The tax credit system is SHITE. I've seen people saying that it's based on the 'tax year', but it's based on the previous tax year! It's so bloody complicated, especially if your income changes in any way, like yours has.

Suck it up, pay off what you can afford each month and get the hell out of it. We're fucked from it, after going £200 over during lockdown, when we were paid an amount from our foster agency (because they weren't paying out training costs etc during lockdown). It was only all 'worked out' the following tax year..... 2 disabled children at home. I'm now paying back £50 per month, but to be honest, I'm glad I'm out of it. Every year it worried me that I might have earned 'too much', but now I'm piss poor and not worried about that shit.

We owe 6k because they didn’t record the changes we updated them with

. what a lovely surprise.

like a previous poster said, I’m just glad to be out of the tax credits malarkey, I was warned 13 years ago this day would come and they would fuck me over and they sure did!

To anyone who has made monthly repayments, how did you set this up? I’m looking to make significant contributions so surely that will shut them up?

I would write to your MP and ask for help, this doesn’t sound fair at all, I am sure the HMRC teams are recruited on the basis of lacking empathy or pragmatism.

It is very very clear

You are entitled to free NHS prescriptions if your annual family income used to work out your tax credits is £15,276 or less and you receive either: Child Tax Credit. Working Tax Credit and Child Tax Credit paid together. Working Tax Credit including a disability element.

No op it's not disgraceful that there has been financial support for you and your family, it's not disgraceful that your children ( adults) will now have access to financial support that's appropriate to there disability. What is disgraceful is your inability to open your own post and understand the system that has supported you over the years .

MPs are not there to try to fiddle the system. No mistake has been made this is how the Tax Credits system works.

Good heavens don’t bloody waste your MP’s time by writing to him about this mistake on your part Op

what a daft suggestion

For all those who are saying that they've ignored letters saying they owed money from about the time that Noah landed the ark - please don't anyone depend on this advice. You may find that the claim you are ignoring will go away. That is what two people I know did. Can't pay, won't pay and how long can they chase me for until they give up? That was their approach. And after 6 years they assumed they were free and clear because they can't be taken to court for it.

Well guess what? They don't have to take you to court for it. Because they can reclaim the money from ANY government income you receive in the future, and that includes old age pension. And there is absolutely not a thing that you can do to stop them.

If you don't believe that the calculation or debt claimed is correct - fight it. If it is correct, come to an arrangement, even if it's £1 a week for the rest of your life. But don't ignore it. The two people I know are now getting deductions from their pension / pension credit and are struggling to pay bills and buy food. And you can't claim more money to increase your income if the reductions are a result of debts you owe on previous benefits. You may think you've got away with it. But you really may not have.

Nothing for an MP to do here.

Yes if you search for the information if you just get sent one when you claim tax credits that info is not anywhere on your award letter.

And why is it fair that ‘family’s like us’ whatever that even means just gets given money from the government?! And the rest of us just have to work hard and look after ourselves on our own. You having an ill child and a disability is no one else’s problem. Typical entitlement at its best!

The "rest of us" includes people with ill children, disabilities and so on. As a society we do have some collective responsibility to support the vulnerable - that is what decent, developed societies do. If you or anyone else is on a low income and has two children with disabilities, you will also get support. That is right and proper, not entitlement.

I also disagree with the OP's position, because they are being ridiculous and blaming others for their own lack of responsibility. If you wish to comment on that, then fair enough. But "families like us" - people on low incomes and with disabilities are not entitled for claiming benefits to which they are entitled. Please don't make this about disabled people not deserving support or benefits.

You need to correct your thread title then Op.

And respond to letters.

While our government piss away millions & billions on duck houses, subsidised lunches, back handers for big businesses & covering their own assess the minions are penalised.
In this case your tax credits will have been worked out over the whole financial years income so I think your new income from the November would have effected it anyway but check that.
Were the tax credits still being paid to you after they should have stopped if they are saying you have been ‘overpaid’?
Go to your MP & get them involved in this one. DWP made the mistake not you & they do not get to ride shotgun & demand immediate payment of anything until they fully explain where they got that number from & why they didn’t close the claim… as they told you they were. It is a basic function they complete in the millions every year so how did they get it wrong to the tune of £2000!!
Takes the absolute piss that there is a statute of limitations on everything but benefit payments because DWP mistakes are being blamed on claimants left right & centre & claimants are being massively penalised for basic financial mistakes a massive company should not make in the scale that it is being found they are.

It is made explicitly clear when you apply for the NHS exemption!

Do you have children @Pinkfluff76?

The correct thread title would be

”I failed to open multiple letters from HMRC and now I need to pay back what I was overpaid in benefits”