TAX CREDITS PROBLEM - PLEASE HELP!

[MAGDA]

Re: TAX CREDITS PROBLEM - PLEASE HELP!

Hi SXGuy, does that mean you think we are probably liable for the overpayments - I still don't really understand why the disregard doesn't apply.

Many thanks for the suggestions you have made, but the trouble is, only my husband works, he is the sole bread winner so to speak, and we have two daughter's in further/higher education, who despite trying to get jobs, have not been successful, as the job situation is pretty bad where we live. We do not have any surplus income at all each month really and like most people have our mortgage etc to pay, so I am a bit concerned, if my husband did ask HMRC to amend his tax code, how much we would be losing in income each month. Would we be looking at a very small amount here each month, or would they be taking around £100+ from my husband's earning, if the code was changed.

With regard to making instalments, that again is going to be a real problem, and given that I have always tried to keep HMRC up to date with regard to my husband's earnings and the fact that there is a disregard in place, I still am not convinced that we should even have to pay this money back at all.

Many thanks SX for your reply and the advice offered, it's much appreciated. Any futher help anyone please as I would really love some opinions on whether you consider we are actually liable to pay this money back.

thanks, Magda

[MAGDA]

Re: TAX CREDITS PROBLEM - PLEASE HELP!

Hi again, just actually received the letter from HMRC confirming that we need to pay back the overpayment. It states that at the end of 2009/2010 we gave them my husband's earnings for that tax year and we estimated that my husband's earnings would be £xxxx, for the tax year 2010/2011. This figure was a lower figure than the figure for the previous tax year, so they based our award on this, but during this tax year, our joint income increased. Well, I actually don't have any income and my husband's income did NOT increase, it is still actually exactly the same now as it was then, when I told them. The only difference was that my husband did a spate of overtime towards the end of that tax year, and this caused his salary to be higher than expected. Why doesn't the disregard apply? In the tax year 2009/2010, my husband essentially had two employers, one, an umbrella company when he was working as a contractor and had certain tax concessions available to him and the second employer around the June of that year, when he was a permanent employee as opposed to being a contractor. This resulted in a slightly higher total earnings figure for that tax year, but the following tax year, we gave HMRC my husband's actual salary as he was then obviously going to be working a full tax year for the new employer as a permanent employee. for the first time. I thought the disregard was there to cover this very situation. My husband didn't know he would be doing overtime and the figure provided to HMRC at the start of 2010/2011 was in fact correct.
Many thanks again, all opinions welcome! Magda

[di30]

Re: TAX CREDITS PROBLEM - PLEASE HELP!

It's very confusing isn't it?

Hopefully SXGuy will be back later to go over this with you.

They stopped deductions for now on mine, because I disputed it, but on that form I requested they send me all the information/breakdowns, including all overpayments etc, but just received that letter to say for not they stopped deducting and are looking further into it.
But they sent nothing else. It's information we are all entitled to see.

So I will be pursuing further if not received anything by the end of the week!

All these changes they made, it appears they have made lots of botch ups too!

Good luck x

[SXGuy]

Re: TAX CREDITS PROBLEM - PLEASE HELP!

Hi.

If im honest, i understand where you are coming from, and can see you have done no wrong, but if they have calculated they overpaid you, through no fault of your own, they can and will ask for it back.

It appears to me as the overpayments are based on the fact he had paid overtime.

Im not too savvy with precedure in these cases as i dont normally deal with tax credits, but if there is a concession between what you declare the income to be for the year and what you actually received, then they are clearly failing to take that into consideration.
however as with most HMRC disputes, there should be a way for you to appeal and ask for an independant inspector to go over the case and make a decision. Usually, once an appeal has been lodged they tend to see in your favour.

I would argue that you gave them all the info they needed at the time, and if there was any overpayments, it was their fault, also argue that your sole income means that any overpayment deductions would result in your income dropping below the breadline, and it is not your fault for their error and you simply do not have the money to repay it. It was spent at the time, because as far as you are concerned, it was correct, based on the information you gave them.

Also, you say that for some time your partner was a contractor, usually, contractors are stopped a higher rate of tax to cover any tax due, sometimes 25 to 30%.

Can i ask, has your partner received any refunds on tax stopped? if he was a contractor, he should have got some CIS25 slips showing what was paid, and what was stopped.

Apart from that, i really cant add much more to it, but i would look in to whether theres any legal form of appeal on their decision, and go down that route.

[MAGDA]

Re: TAX CREDITS PROBLEM - PLEASE HELP!

Hi Di/SX, thanks both for your replies. I think I will have to ask them for complete breakdowns, rather than just figures stating that there is an overpayment, asking exactly how it's calculated, maybe if we do appeal we can do that as part of the process.

My husband worked part of the year as a contractor in the IT industry, so they don't get CIS payslips, but he had an umbrella company, which is really like a firm of accountants and they work out your tax each month and you pay both employer and employee NI as well, which is deducted in the normal way, just as it would be for a regular permanent employee. The other option would have been to set up as a limited company which we didn't choose to do at that time. The final salary provided was that stated on my husband's P60, and then for the rest of the year he worked as a regular permanent employee, again we gave the correct figure. The following tax year was his first complete year working as a permanent employee and we gave HMRC his exact salary (that he was officially due to earn), but then the overtime suddenly sprang up, increasing his earnings towards the end of the tax year. What on earth is the disregard for, I just don't understand that at all.

think we will look into the appeal route, so many thanks again.

regards, Magda

[jen_br]

Re: TAX CREDITS PROBLEM - PLEASE HELP!

We had the same thing Magda, I stopped all child benefit we were getting didn'tr fill out a claim for the next year so they are stinging me for the "overpayment" plus for not filling out a claim (even though we weren't claiming) because they couldn't get the money back!

[di30]

Re: TAX CREDITS PROBLEM - PLEASE HELP!

Was told to write the below, from a volunteer mod, for Tax Credit Casualties.........

"I dispute responsibility for the overpayment and demand a thorough breakdown of how the overpayment occurred, including the date of all awards notices and the details stated on them, the date and details of all contact from me, the dates of all alterations / calculations to the award and the impact of the changes.
I also request copies of all my records and expect this request to be treated as a Subject Access Request under the Data Protection Act."

[di30]

Re: TAX CREDITS PROBLEM - PLEASE HELP!

The form below was the one I sent? Did you send them one of these?

[MAGDA]

Re: TAX CREDITS PROBLEM - PLEASE HELP!

Hi Jen and Di, seems a lot of people are having these problems doesn't it.

I will ask them for a complete breakdown using the wording you posted Di, that is probably my best bet, to get them to provide everything so that if I need to see someone about this, I will have all of the info to hand anyway.

I did fill in the same form as you - the TC846.

Will try to do a bit more research today and get a letter off to HMRC - hope you both get your own problems sorted, be thinking of you and will be interested to know how it goes for you.

magda