Tax credits stopped and asked to pay back for 2 years

[Hopingtobehappy]

I dont know whether this is in the right place.

I am separated from H and have been for 18 months.

We run a business together still, address for the business is where I live.

Tax credits 'investigated' my single claim and they have written to us now sayingthat they have closed the claim and that I have to pay back £10K

I have not been given any chance to prove that H does not live here, they say that they have checked and that there are numerous 'association' with my address and that is sufficient doubt over my single claim.

Of course there are numerous associations! we run a business together! we have 2 joint mortgages and we have 2 children! what do they expect?

I am in a bit of a mess as payments have stopped altogether. Even when we were a couple we still had a claim jointly and even that minimum amount would have helped.

[Hopingtobehappy]

Polly, I have explained several times now that the mortgage repayments are LESS than renting.

Lots of people have mortgages, AND can make the repayments, AND claim tax credits.

As I have stated several times also, I did not ask for tax credits, they paid them to me and then changed their minds. My circumstances didnt change from when I told them.

They know exactly how much we both earn, unless their departments donttalk to each other.

I dont make the rules and having been a taxpayer for 25 years I dont want the money I pay to be wasted either. Believe me, I have paid a hell of a lot more in tax over the years than I get back, and that isnt including the VAT and CIS payments that I collect for them (at no charge to HMRC) either.

I asked a question about my ciscumstances and all I have had from some people are their opinions on whether I should get tax credits or not, that really isnt helpful.

Were, thank you and very good point about maintenance payments, in theory I could claim to earn much less, or even nothing at all and my H give me a fortune in maintenance.

Sock, thats also a good point, I really cant win with HMRC here can I!

[Hopingtobehappy]

Polly, so anyone who remains on good terms with their ex, is still actually with them?

We never had sex when we were together anyway, so if sex is anything to do with it, I can make a back claim for about 10 years :-)

[mrsbungle]

I believe what you are saying OP but from what you have written I imagine it looks (to the tax credit people) that you are not separated. You appear to be living as a family - just in separate houses.

Maybe you should see a solicitor with regard to a separation - maybe they have some advice re how other sort their finances in these situations.

I also think people are hung up on the mortgage thing because it seems a lot of mortgage for a combined salary of £35K, I wasn't aware that was possible! If you pay less than £400 a month for this, that 's also surprising (not saying it's not true). My mortgage is £145,000 and I pay around £800 a month. I think I need a better deal!

Anyway, sorry to go off the point. Could you face just phoning them yourself? Surely they have to talk to you regarding your own claim? At least you would have first hand information rather than second hand from the Accountant?

It must be really stressful to get a £10K bill that you can't afford out of the blue. Good luck.

[coribells]

my ex and I are separated, not divorced. His name is still on deeds to this property, and and some of his mail etc comes . bank stuff etc. I was also investigated by tax credits on two occasions. My ex is renting and where he lives is not very secure in terms of mail(shared letter box) . it was complicated by the fact my ex lived in this property by himself after we separated.( I was living in rented) I moved back here after landlord wanted the property back ( and he moved out) I explained all this to the tax credits. I wrote it in a letter, it also helped that we had been to mediation to agree to this arrangement and had it in writing. Have you sort any legal advice, is there any professional person who has advised you that could back up your claim.

[Hopingtobehappy]

Mrs Bungle the £400 mortgage is for H's house, the mortgage for my house is over £1000.

Obviously we would have to pay the mortgage for the house I am in anyway, but if one of us had moved into rented it would have been around £700 to rent somewhere.

The mortgage that is over £1000 is an overdraft mortgage, which basically means that as long as we pay in a certain amount each month, that is fine, at the moment I am withdrawing the money and paying it back in, but that is mainly because the business has serious cashflow issues and I have just paid our tax bill, plus a large VAT bill, anyway beside the point.

OUR MORTGAGES ARE OVER 35 YEARS AND THAT IS JUST INTEREST!

TAX CREDITS ARE NOT PAYING OFF MY MORTGAGE! unless we find the full amount to repay at the end we will either lose the business, or will have to sell one or both houses to pay the bank back.

I really dont understand the relevance, as if we separated and lived in rented then we would both have to pay the rent! whats the difference?

No I cant phone them as my accountant has told me not to as they are now dealing with it. They were very nasty to me when I did speak to them to be honest so I am not sure I can handle it. Yes it is very stressful and I am very worried about it, thank you :-)

[Hopingtobehappy]

We have had no legal advice. We split very amicably, nobody else involved, have to be friends for the business, we decided we would divorce after 2 years, we didnt see the point in spending monmey on solicitors etc. when we dont have to !

Our Accountants knew we had split as we asked them for figures etc. to help us remortgage.

[IneedAsockamnesty]

Polly it means living togather as if you are husband and wife.

That actually involves you living as the same household under the same roof and NOT either living in two separate houses or sharing the same roof but living under it as two people not in a relationship that is self defined as being part of a couple.

Op did you read the sections relivant to you on the link I posted? Its tax credits own rule book and really worth a read.

[IneedAsockamnesty]

Oh and you need to find out exactly how your accountants are dealing with it as they are experts in money not in defining relationships. Let me know when you have gone through the link and then I will be more than happy to give you a list of instructions of things to prepare that can be sent to tax credits to bak up your stance on the matter.

[Hopingtobehappy]

Sock, yes still reading !

I think they mighthave terminated my claim because of 'information not recieved' they first wrote to me in November, I rang them straight back and they were awful to deal with and I wasnt well, that was when my Accountant took over and it took a few weeks to sort out the forms etc. On the letter they wrote to me saying they had stopped my claim it said that it was because they hadnt recieved the information they had requested. However neither me or my Accountant had recieved a letter asking for anything specific.

[Hopingtobehappy]

I have to say I am very confused!

Either you are with someone or you arent, like you say the definition of being separated is when you separate!

Thanks sock I really appreciate it, I will keep reading!

[RedHelenB]

Hopingtobe happy - you DID ask for tax credits in that you gave the information as you as a single earner! I am not saying I don't believe you but since you won't answer my question re maintenance (fair enough - you don't have to) I assume that everything is coming out of joint accounts hence you are operating joint finances after 18 months of separation. Dating other men isn't the issue - you could have an open marriage after all. All I am saying is I can see why tax credits made that decision. The compliance team visited me & wanted to know a lot of details, scrutinising bank statements etc.

[Wereonourway]

Sick- what I Meant in previous post was that the op had considered herself to be single- in fact she discussed this during a call to them.

Hmrc have considered her to be in a relationship- I was trying to say that if op goes by their decision, which they have just made, could the previous 18 months tax credits claim be changed retrospectively?

I actually work for hmrc, but am relatively new to it and as such cannot answer that question. Once compliance have involvement in a claim, advisors have absolutely no powers over it, until cleared

[Hopingtobehappy]

Yes he pays maintenance, in the form of paying the mortgage.

We both get paid and we both then pay into the joint account.

I have never disputed that we have joint finances.

I gave them information and THEY TOLD ME that I was then a single claimant. H still lived with me at that time.

[SofiaAmes]

This is bringing back memories. I spent a lot of time reviewing the tax credit rules and quoting them back to them. It seemed that no one who worked there actually was familiar with their own rules. We too did not fit into their little boxes of the conventional family setup and they just couldn't get their heads around it, despite having written guidelines outlining exactly what they were supposed to do.

[Flibbertyjibbet]

Just ringing up the tax credits people and telling them you have separated is not enough to actually BE separated for tax credits purposes iyswim.
You are meant to do that as just one part of all the things you have to do to actually be separated.
I would take responsibility back from the accountant. For ond thing he will prob charge you for his time doing it!
Can you speak to tc and ask them what exactly they need for you to be seen as single. And if they tell you that means no jojnt mortgages or investments then youll have to do that.

[Hopingtobehappy]

It also reminds me of the tax investigation that we had a few years ago :-(

I was told 3 different answers by 3 different advisors, then a 4th told me that if I was wrong I would be the one held responsible! WTF!!

[Hopingtobehappy]

Flibberty, how can you just suddenly have no joint mortgages?

And as I have said a few times now, THEY TOLD ME THAT I HAD TO CLAIM AS SINGLE because I had told them we were separated.

I have kept my side of the bargain, they seem to have made theirs up as they went along

[Hopingtobehappy]

The Accountant is charging me, but it is worth it because it was making me ill, he has agreed a set price though, as he has worked for us for a lot of years.

[Hopingtobehappy]

From what I have picked up so far:

• You can be separated but live in the same house and you can claim tax credits
  
• You can live in separate houses, but have a joint account and mortgages so therefore you are not separated and cant claim tax credits
  
• You can be separated, live in different houses and get £10K a month in maintenance, but because you dont have a joint account you can claim tax credits
  
• You can be separated, live in separate houses and because you dont have a mortgage you can claim HB and tax credits
  
• You could have a portfolio of 50 houes, all paid off in full, but be able to claim tax credits
  

Confused? I am !

[Hopingtobehappy]

What if my date tonight goes well? will I have to add him to my claim as well?! he owns his house outright, I'd best tell him not to pay for dinner :-/

[Flibbertyjibbet]

Please stop blaming the tc person. If you ring up saying you are separated then of course they will say you have to claim as a single person! But then Iits up to YOU to then actually BE seseparate financially. You still have married finances, cant you see that?
Separated couples either buy each other out of the house or keep both names on to sell it say when kids older. What you would not expect is for them to buy a 2nd house in joint names after you say you have separated.
And now you tell us you still both pay into a joint account, hd pays you no maintenance but pays the mortgage, and you have joint investments.
You should have used that call to tc as starting point to begin separating physically and financially.

[Floggingmolly]

You're still paying your salaries into a joint account; from which you pay your two joint mortgages???
The tax credit people aren't interested in your sleeping arrangements; they're interested in your finances and your finances aren't separate.

[Flibbertyjibbet]

Floggingmolly said in one short half sentence what I've been trying to say in huge paragraphs

[FiveGoMadInDorset]

As far as HMRC are concerned nothing is separate therefore you are still together.