Is it fair?

[TaxCreditsHelp]

Was on Tax Credits, but stopped them when started working almost 2 years ago. When I rang them to tell I'm stopping TC because of work, I was warned that I might have an overpayment. Received letter last week where it says I was overpaid by more than 2k.
How is it fair that they put together amount of TC I have received and money I have earned- there was no overlap!- and decided that I have to return everything they have paid me in TC that year up-to a point where I found work and started working? I have used TC payments to live before I found a job.
I understand if it was an overlap or they have found my circumstances different while I was claiming, but this is purely because my earnings for that year became too high to have been entitled to TC. But I did not know I will get this job and, also, needed money to survive up to a point where I started my new job!
I spoke to a nice man at TC and looks like I have no choice, but to pay.
Has anyone had this and won?

There has been a flurry of posts about old debts on tax credits that people think are wrong. Seems HMRC are having a bit of a clear-out.

The first thing to do is to get full details of everything they say you owe and why: full calculation. Then get help, maybe try Citizens Advice or TaxAid to help you go through it and work out if there is any overpayment and talk about repaying anything you do owe but correcting any mistakes.

HappyHoliday, I checked the amounts and the amount they are demanding back is the sum of all the TC payments they have paid me for that financial year- up to a point when I found a job.
My question is how is it fair that they count whole financial year, not just up to a point where person starts working and stops TC?
They counted my earnings from the job for the remainder of the financial year, decided that I have reached threshold, and demanding TC payments back. But I was receiving TC payments for the beginning of the year, when I was not working and not earning anything.
It is so unfair imo!

I don't know the rules, you'll need to check what they were at the time. It may be right or may not.

You ask if anyone has won? There is nothing to win because there is nothing to challenge unless you think the overpayment amount is correct. tax credits are calculated annually so if you earned over the threshold during the year in question you will need to pay everything back that you have bene paid. If you had been claiming Universal credit then you wouldn't have needed to as it is calculated monthly, so is a fairer system. The sooner tax credits are completely phased out the better in my honest opinion so that people stop getting these overpayments which cause people stress.

They counted your earnings as tax credits were based on annual income. Your annual income meant you were not entitled to tax credits but they didn't know that would happen when the award was made. Surely it would be unfair for you to be able to keep your tax credits when someone else who had your same salary received nothing just because they earnt it evenly over the year.

It's correct. They guesstimate your earnings when a new tax year starts - so even though you told them and it stopped - your earnings meant you wasn't entitled to what they paid you up to that point in the tax year.

Sorry that should say incorrect.

Yeah this happened to me. Financial year of 2019-2020.

I started the financial year on a low wage and was single parent with 2 kids in breakfast and after school club. In the September I was offered a job at twice my wage, which meant I no longer qualified for tax credits. That was fine. I submitted the changes and they stopped paying me. Again all fine.

The next year they wanted all the payments between April and September 2019.

It does seem incredibly unfair. I claimed the money when I needed it. Stopped when I didn’t. But they want the money back because in that financial year I earned more than I planned. Because that’s how they measured it. The person on the phone told me I should have anticipated getting a new job, months before I applied apparently.

I called them and set up a monthly payment to pay them back.

It's a horrible system isn't it. I only claimed for just over a year, after ex left , only had one job, one set of childcare costs, provided all the information and paperwork yet still ended up with a big overpayment.

I negotiated to pay it back at £50/month which they were happy with.

But it's a monstrous system. I do complex multimillion pound tax returns for work and there is so much more help and guidance for those. It's like they really don't care if they leave people in a mess.

It’s a known shit thing about the tc system, as it’s based on annual rather than monthly income. Don’t make yourself short paying them back, if you offer £20 a month they’re likely to accept

Yes, it is so unfair, as I claimed when I needed and stopped claiming when I found the job.
Will call them tomorrow and will offer £20pm as that is what I can afford at the moment. My job ended just before Christmas and, although, I have a new job offer, it doesn't start till March. Not claiming anything at the moment, as I have planned for this and thought I'll be ok with a bit of money I have saved- and now I have this £2k hanging over me!