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.

[FatimaLovesBread]

I don't see how your figures stack up so I suppose that the tax credits people would be think similar too. Although surely they should have asked you to provide evidence to either prove or disprove their suspicions of being a joint income family.

I could do with a budgeting lesson from your XH though. If he's paying a £1000+ mortgage and a £400 mortgage from his £25k salary he either has little other outgoings or he's fudging his income. Perhaps the HMRC have looked at things like that to come to their conclusion?
Although you have said it's an overdraft mortgage and I'm not sure what one of those is if that's explains it

[Viviennemary]

I think your claim has been looked at and as you own two houses and run a business and can finance £300,000 worth of mortgate they probably think you don't need any help from the tax payer.

[Viviennemary]

'mortgage'

[IneedAsockamnesty]

Unlikely.

The claim has been looked at because at the moment there is a huge focus on lone parents claims.

A bog standard credit check has shown a link between op and her ex and they have used that to decide they are living under one roof as a couple.

[EggwiniasRevenge]

Whether she has assets worth £1million is semi-irrelevant.

Tax credits is assessed soley on income. (And hours worked and info relevant to the dcs).

Tax credits are concerned this is a fraudulent claim as these people do not appear to be living a typical seperated life.

There has been a lot of judgement on this thread as to whether there should be 2 mortgages on this income etc.

That's kind of irrelevant.

First question is can you appeal the decision.
Second question is what evidence would you need to win the appeal.
Third question is do you have such and sufficient evidence?

Then once you've dealt with that I woukd start questioning the set up of your joint/individual finances.

[KayHunt]

Would they consider the idea that you have two homes as a reason to stop the claim as well? Maybe they believe that you are gaining income from the property your husband is in.

But still, the accountant has probably made it clear to them that the bills are in joint names, you share a bank account, own two homes with your husband- to anyone outside it does look like you are together and your current and past incomes do not qualify you for tax credits anyway.

[IneedAsockamnesty]

Kay,

Only if they think she has undeclared rental income from the second home.

Yes she can appeal and go as far as tribunal if warranted.
To win she needs as much as possible that proves she does not live with her ex, letters from professional bodies evidence of his sole occupancy in his house ( they legally cannot ask for this but the op can offer it)
Statements from people who know them the school anyone who the op as spoken to about the break up.
She could even provide a statement from someone she is intimate with or from her ex stating he is not in a relationship with her and is with others.

Her income is not the issue her relationship status is.

[Viviennemary]

I too think that owning two homes would be a factor in your claim. And perhaps also the amount of profit the business is making as a whole and the amount of money you are taking from this profit as your earnings. And of course that this is all intertwined with your husband's earnings from the business will make this claim a complicated one.

[IneedAsockamnesty]

Viv.

What you think does not matter,what matters is what the rules are. Her claim has been stopped due to them believing she is not separated if there was any other reason they have to tell her.

[SofiaAmes]

Sock clearly knows what she/he is talking about more than anyone else on this thread. OP, I would listen to her and follow her/his advice with care.

My case was a similar one....I called up and asked for advice on how to claim given my circumstances. I then followed that advice. I then got letters saying that they didn't believe those to be my circumstances. I soon realized that this was because at first glance it appeared to be something else and no one had bothered/had time to delve any further into it (or read my first 5 letters). I wrote a final letter with much more detail and referenced the dates and times of my phone calls and letters. That final letter settled the matter, presumably because someone finally delved into it a little further.

[IneedAsockamnesty]

Op, can you obtain letters from as many people as possible both professional and personal to state you are not in a couple relationship with him.

One from him would also help.

They cannot ask you to provide third party info but you can offer it, stuff like a letter from a neighbour or friend and a member of your family.

One of the 'tests' they have is how do friends neighbours and family perceive your relationship status.

Evidence that you do not socialise together as adults or go on holidays together nor do you make future plans together,you don't share meals or household tasks.that nobody who knows you would consider you to be anything other than single.

Copies of anything that you and him have written regarding contact arrangements or maintainance or him no longer being able to use your home freely or as a residence. Even screen shots of emails or text messages will help.

Every and anything you can think of take copies of everything and send it all off so it has to be signed for with a contents index top sheet.

What ever you do do not make a joint claim or anything that increases your links with him.

[IneedAsockamnesty]

By third party info I mean info that breaches your data protection or that you have no legal right to obtain.

But you can breach your own data protection ( or what ever its called these days) and the person who does have the legal right to obtain info about them ( your ex) can obtain it for you. If he does make sure his letter includes that he has only provided the evidence on your request to assist you to prove your single status and he resents feeling morally obliged to do so.

[Viviennemary]

I wasn't saying she shouldn't get the benefit because I said so! But I thought a second home would be included when deciding on entitlement to a means tested benefit. Maybe the withdrawing of the benefit isn't entirely dependent upon whether or not they think she is still living as a couple. It might be withdrawn on other factors. Like she owns a business and could take more salary than she does.

[EggwiniasRevenge]

When you apply for tax credits you tell them:

Your employment status & hours worked.
Your relationship status.
Employment status for any partner if relevant.
Earnings as an employee/self employed.
Any additional income if over £300 (eg sgare dividends, bank interest, rent probably).
Dob of any children
Costs of childcare if relevant.

You don't tell them if you rent/own your own home.
You don't tell them how many homes you own.
You don't tell them how much money you have in the bank.
You don't tell them any of the above because they don't ask.

It is means tested on income. Not assets.
Based on the information in the op hmrc are investigating whether there has been a fraudulent decleration of relationship status.

Why do you think they have stopped it based on information they don't need? Don't request. And almost certainly don't have. And most importantly according to the claiming criteria aren't relevant (they are for other means tested benefits). Especially when they have stated that they are investigating the relationship status

[IneedAsockamnesty]

Exactly what egg said.

Only obviously she said it first

[Viviennemary]

Now it is becoming more clear why they are overhauling the benefits system.

[RedHelenB]

But if they investigate then they need to know about mortgages as in this case.

[skyebluesapphire]

I think that when Universal Credit comes in, they are going to hit the low earning employed and the self employed people. You will be deemed to earn at the minimum wage for so many hours. so company directors that pay a low salary will be deemed to earn say 30 hours a week at NMW and so will self employed people.

i dont know exactly whats what, but that is the gist of it.

They are doing that so that people cant deliberately keep their earnings down to get tax credits.

(Im not talking about you OP, just discussing how/why they are going to change the system)

[Flibbertyjibbet]

The second house is relevant though. Not because of the size of the mortgage relevant to income; but because it was bought In Joint Names after they told tc theyd split up. And two years down the line their finances are still arranged as a married couple. Many married couples dont have a joint account so it just looks odd that a separated couple still have everything joint.
Yes untangling finances and joint account can be a pain, but if you are separatex its what you do!
I am with others who say the accountant may be making this worse. Can you speak to tc on monday and say you need in writing exactly what grounds they havestopped your claim because you want to appeal. At least then you will have facts and not a bunch of mmums pondering what the reasons might be.
Scuse typing am on phone.

[IneedAsockamnesty]

Flibberty.

Having finances still tied up like that is pure stupidity but its not a crime if the op can show that there is a good enough reason for it then she will be fine.

That goes for the mortgage as well.

[EggwiniasRevenge]

I agree. The joint finances is the 'evidence' that they are still behaving as a married couple.

Taking out a joint mortgage after seperating is 'evidence' thar they are still behaving as a married couple.

Neither is proof though (you don't have to be a couple to take out a joint mortgage).

I was just trying to seperate 2 issues being debated on this thread.

1. OP has had her tax credits withdrawn as a result of investigation into her relationship status. This should be the main focus of the thread.
   

1. Lots of people are getting hung up on the second house. £300k mortgages. Questioning entitlement to tax credits. None of this is of any help to the op imo.
   

The ownership of a second house worth £1million would be irrelevant. She could still be entitled to tax credits.

Taking a second mortgage in joint names after seperating is relevant to investigation (though not initial claim per se). But only on the grounds it is a joint investment and not a second house.

The finances do need looking at and disentangling as per my original post but they should not be proof that these people are living together as a couple. It may support the hmrc case but should not prove it.

The op needs to find out what info/evidence would be needed to counter their claim and focus on sorting that. You can't remove the facts that finances are still joint, but can you provide additional evidence that you are not a couple as detailed by sky?

Once this is sorted then look at what xan be untangled. I would suggest:

Buisiness account as joint signatories to deal with the business finances.
Perhaps a joint account to pay mortgahe and house repairs.
Sole accounts to pay out day to day living expenses. Utility bills would come under this category and should not ve paid from the joint account. (Think I've seen elsewhere on thread tgat they are treated as a joint expense?)

[Viviennemary]

But my point is that if the finances are totally entwined and the OP is partly responsible for paying two huge mortgages totalling £300,000 perhaps they do not feel that her earnings merit the tax credits. None of us know the real situation so it's all guess work anyway. Not saying this is definitely the case but it could be a factor. And if she only separated last January 2012 why is she claiming two year's tax credits as a single person anyway.

[IneedAsockamnesty]

If that were the case they would have to have investigated her earnings not her relationship status

[Viviennemary]

They've closed the claim so obviously they don't feel she is entitled to the money. And from what information the OP has given I would tend to agree with that decision. But of course it's not up to me or anybody else here but up to the decision makers.

[IneedAsockamnesty]

No its up to the actual law and the rules.

The vast majority of claims they close without certain things happen (things the op says haven't happened) get reversed on appeal due to the compliance team deciding to early without enough info and paying no regard to their own rules.