A friend of mine who is quite severely disabled reduced her working hours last December due to health problems. Before she did so I had telephoned the helpline to make sure her new income would be used to calculate her award and that no overpayment would result. I was assured everything would be fine.

Following her renewal claim she has now been hit with an overpayment which is being collected this year, reducing her WTC from £6.05 a day to only £1.83 a day. This will definitely result in financial hardship and she is too ill to return to work full time.

She has a week left in which to appeal. I'm not sure whether to go down this route or push for them to use their discretion not to recover (especially given previous posting.) I don't want to use her as a guinea pig.

Any ideas?

I would appeal as your friend reasonably believed payment to be correct. You had called them, notified them of change of circs and been told that there was no problem. Therefore, it was reasonble to believe award correct.
They also say they keep recordings of calls for 6 years so you could insist on that being produced, which may make for an interesting Tribunal.

Thanks for your thoughts, Derek.

I was wondering if your advice may be more relevant to asking them not to recover than to an appeal. Maybe I'm just having a thick day but I can't get my head around exactly what I CAN appeal against when it's a tax credit appeal because official error/failure to disclose, etc don't figure. Whenever I think about it I keep going back to the fact that she actually has been paid the right amount because her final income figure for the past year did exceed the figure they had used yet was less than the previous year so we can't discount the £2,500.

I'm tempted to put in an appeal AND a request not to recover but would that mean she is, on the one hand, saying there is no overpayment and on the other asking them not to take it back?

HELP!

Lorraine,

I take the point about not knowing what to appeal against. Not sure if it is possible to appeal against actual recovery. But I wonder if we to try and appeal against actual overpayment decision and see how a Tribunal view the facts and if necessary if a Commissioner would be happy with the fact that there is no such thing as official error. It just seems wrong that the IR can make mistake after mistake despite our clients best efforts and get away with it.

It may even be possible that the paperwork provided by the IR will be so incomprehensible that it won't even prove that an overpayment exists and there may be technical arguments to develop.

If you don't appeal you are only left with the option of asking them not to recover. I wouldn't have thought that there is anything to stop you asking this after a Tribunal if it unsuccessful.

I did wonder about both approaches at same time as well but share your concerns.

From your friends point of view you the problem is that they will continue to recover throughout the appeal process - and as we know from other strands here it seems to take an interminable time.

The push for an amnesty on overpayments obviously needs to continue!

Thanks again, Derek.

I realised while looking through my friend's numerous recent letters that the one we need to appeal against is already slightly out of time so I've put together a very loose appeal argument to cover most possibilities and sent it off for her to sign, stating understandable confusion as the reason for a late appeal.

I decided, at the same time, to send off the form asking them not to recover, being careful not to actually mention the word 'overpayment'. It may be slightly risky butI'm aware, as you are, that the overpayment will continue to be recovered while waiting for appeal and she simply can't afford this reduction in her income.
Besides, I'm sure I can explain it away given that even advisers can't get their heads round the process.

I'll let you know how it goes. In the meantime if anyone goes to tribunal could they let me know what to expect?

Cheers

Lorraine: I thought (see the Tax Credit recovery of overpayments code of practice) that recovery of overpayments is limited - in most cases - to 25% of the 2004-05 award. Unless your friend is also getting CTC I think this would reduce the amount from £6.05 to £4.54, not to £1.83. Have they made an error here? If so, I would think you could ask for it to be altered to a 25% recovery regardless of what other action you take.

Hi Derek,

You're right - there is a limit on the rate of recovery and, as there's no CTC in payment ,it looks like it should be 25%. Friend is coming in this afternoon so I'll call the helpline and see if we can get something sorted out sooner rather than later.

Thanks for your input.

I have just had a similar case. Overpayment due to IR mistake - client even phoned the Helpline earlier in the year to make sure the payments were correct and were assured they were. Appeal lodged and also request not to recover.

Overpayment started to be recovered in June, after the renewal/review/reconciliation form sent in. Over the full 12 months, this year's award will have been reduced by 25%, but as the deductions are being spread over only 10 months, the result is that the actual payments they are now receiving are reduced by a higher figure. Presumably, as the year goes on, the financial implications of recovering 25% over 6,4,2 months will get worse.

I have just received a telephone call from the Inland Revenue to tell me (or should that be gloat?) that my friend/client's overpayment is 'very much, 100% recoverable' and that this decision is not negotiable as he was the one who made it.

The reason given was that since reducing her hours and therefore her pay my friend has had too small pay rises and therefore is on a higher income than previously stated so cannot possibly be suffering hardship.

This charming man then went on to give his tuppence worth on how clients could 'save up' to repay their overpayments by putting aside any supected extra being paid to them and that many of 'these people' can well afford to repay overpayments because they are on 40 or 50 grand a year! When I confessed that I didn't understand the system too well back then but do now he laughed and said, "Well maybe you could educate me then!" Ha Ha.

So, there you have it. They don't have a clue and don't give a damn.

How about getting teh MP involved? It might not do any good, but at least lets them how their laws are affecting people.
Carol

Good suggestion, Carol.

I'm still seething at his 'I'm doing this because I can' attitude and, while I agree that getting the MP invloved may not do any good, the futility of the process has to be uncovered.