Welfare Benefits Caseworker, South Tyneside CAB, South Shields, Tyne & Wear Member since 27th Oct 2004
Improving Tax Credit administration Fri 17-Feb-06 08:48 AM
I've been reading the Paymaster General's report again. The threshold for reporting changes of income will be raised from £2500 to £25000. Which means there will be a lot less work for the TCO to do amending in-year awards. So hopefully they will spend more time sorting out the mess. But what bothers me is that people will have much larger overpayments at the end of the financial year. Am I reading that right?
Welfare Rights Officer, Stockport Advice Member since 02nd Jun 2004
RE: Improving Tax Credit administration Fri 17-Feb-06 10:54 AM
As I see it there would only be an overpayment if you didn't declare a rise in income of £25001 or more. Anything less could not result in an OP. Unless......
I think the overpayment problem will be deferred into the next tax year. If the claimant does not notify TCO of the increase then the provisional payment in the new tax year (i.e. until the annual renewal is done - which can be several months) will still be based on the old lower income and a substantial overpayment can then arise between 6 April and the date the renewal is processed.