I have been referred a case where the client has been issued with a massive overpayment of HB/CTB due to not declaring savings over £16k. No fraud action is to be taken according to customer as they have accepted that she has physical/mental health issues and did not intend to defraud (I need to check this is the case). However client wishes to appeal the overpayment on the same grounds - physical and mental health. While I accept she has these health difficulties and I will check that they amount said to be overpaid is correct, I do not see an appeal been successful as she has accepted she failed to declare and she has the income to pay the money owed back. I wondered what other advisors think?

Tue 06-Nov-07 07:52 AM by Kevin D

Where there is no error on the part of the LA (or the DWP or HMRC), all HB/CTB overpayments are recoverable - HBR 100(1) applies. In the absence of such an error, an appeal will always fail.

There are two options to be explored:

1) Is it possible that there was in fact an error? e.g. Did the LA (or DWP / HMRC) overlook info they already had?

2) If the o/p is in fact recoverable, you could try and ask the LA to exercise their discretion about seeking actual recovery (there is no right of appeal on this matter). Trouble is, where capital is involved, LAs will generally pursue recovery.

Hope this helps.

Do make sure that they have done a diminishing capital calculation. If her capital is not too far above £16000 the repayable amount is likely to be quite a lot less. Many LAs in my experience have never even heard of diminishing capital calcs and even when told about them don't know where to start.