Tax credit overpayment

[Amanda3266]

Help! I 've just had a letter saying that they've overpaid us by £1400 (Tax Year ending 2004). DH was out of work for a while in 2003 and all our payments from them increased - then he went back into work for a short time. However, he only had this job for a short time before starting his own business.
This year when we do our renewal I suspect that our income will actually be very low (if any profit at all) by the time we've taken off start up costs. We have an overdraft - only small but still there and I just cannot even begin to think how we are going to repay this. They have said we can repay it over 12 months but even that's too much for us at present as it would be at least £100 a month we don't have now. Anyone else had this?
I'm just steeling myself up to ring them but dreading it. Is it likely that when this tax year ends and we show the new reduced income for this year that they'll knock what we owe off the amount we'd get for the following year - if that makes sense?

Mandy

they did that with us. they reduced our payments over the next year.

Yes, they'll probably reduce your payments for the next tax year.

If you find that it's not reasonable and you really can't manage, you can see your MP about it. There have been cases where paybacks have been waived because of hardship. Or they might agree to reduce payments over 24 months, instead of 12.

HTH

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Many thanks for that - have calmed down a little now . It'll all get sorted.

With child tax credit if you have been over paid they usually take out of each months payment I dont know if this is the same for all taxes. You can appeal, there is a process you can go through if you explain your circumstances to them and how it will effect you ask them for the info over the phone they have to take your income into consideration they may reduce the payment if you can prove how it will affect you.

I was overpaid hugely when it first started I got about £550 every month, instead of the year!! I called and asked them to stop sending it and put it away in a savings account. I used about £500 last year for a holiday and this year another £500. After April I should be able to use the last £500 for this years holiday.

They've overpaid us by something ridiculous like £4000. CAB say they can only get it back by reducing future payments and even then they can only take a maximum % (something like 47%). I think it's going to take us about 25 years to pay it back....

they will knock what you owe off what you are getting. Also you may not realise that if your income is very low next year you may get free school meals for your children. I didn't realise this - we get no benefit because we have capital but that seems to be ignored for free school meals.

They told us that they'd overpaid us and all they did was reduce the payments of Child tax Credits and stop the Working Tax Credits, which weren't very much anyway. I think it's mostly been paid back now as the CTC have gone back up but still no WTC so must still be paying some of it.

My dh is self employed and I change my hours every few months. Every time our estimated earnings for the year change, I call up the child tax credit people and give them the new figures and they do a new calculation and send us 4 copies of the forms! We have had ups and downs, so there has been some repayment and some increased payments. I would definitely let them know throughout the year as your estimates change so that you don't have any big surprises. They will also subtract the money your "owe" from the payments they make you this year (which it sounds like they should be larger as your dh's income has gone down).

Hi Amanda3266

See the Cab office as soon as they are very helpful and supportive. They also carry alot of clout

Could you get the accountant who deals with DH's business to deal with it as they may know a loop hole or something.