tax credits

[malagabob]

My son who is separated from his partner, has just received 2 seperate demands for the same period( April - July 2008), from the IR of overpayment of tax credits. How come they were over payed when its the IR who decides how much they should receive. The demands have both their names on, but its only addressed to my son.

[karenmac60]

They are paid based on previous earnings and an estimate of earnings for that year. If they later find that the recipient has earned more than they anticipated then they will claim back the overpayment - usually by reducing future payments. But if that claim is no longer active then they will ask for the money to be paid back to them, either in a lump sum or by arranged instalments. If the partner's name is also on the form then she probably got a letter too. I imagine if they have split since 2008 then they did have a joint claim but no longer do which is why they are being asked for the money rather than adjustments to future payments.

[themas]

Are you saying there are two demands for the same period for different amounts - i.e. that he is being asked for the total of the 2 figures? If so, there is very likely something wrong & it certainly needs to be queried.

Even if that is not the case & he is only being asked for the amount on one of the demands it should not just be accepted as correct. Depending on the reason for the alleged overpayment this can be complex. It may be that the calculations need to be checked in detail in relation to his & his ex-partners income during the period concerned.

However, as the period concerned is short & starts in April it may be that the overpayment is because no annual declaration was submitted to the Tax Credits Office for the 07-08 tax year. If that was the case they treat whatever payments they made in the next tax year (i.e. the one starting in April 2008) as overpaid.

If the overpayment has to be paid back your son should not have to pay all of it - they are supposed to split the liability in these cases 50:50 between the partners. Also he can come to an arrangement to pay by instalments over 3 years (sometimes longer depending on his finances).

It would be a good idea to see the local CAB - taking all the papers, income details for the 07-08 year etc. Ask to see an adviser specialising in Tax Credit issues.