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still feeling my way round this, Jane, but as far as i understand it, technically, an award to a couple, or an award to a single claimant, is ended by a change to that joint or single claim status. any payments after that change are 'overpaid'. a new claim is needed, with the normal time limits applying. i'm not aware of any regulations on taking account of underlying entitlement.
these technical claim and award requirements result in (what i call) technical overpayments and what the inland revenue calls overpayments. overpayments theoretically are recoverable, _and_ can attract penalties.
you would expect that an overpayment entails a loss to public funds. why should the government be able to make you pay them money, if you have not had money you shouldn't have had? (You owe us £6000 because you didn't fill your forms in properly!? )
however, these overpayments are caused automatically by the termination of award on the change to single/joint claim status, not by the effects of the change of circs itself -eg partner joins household, earns £80,000 pa therefore no longer entitled.
morally, the IR should take account of the fact that there is no loss to public funds, either because, as they say, if she had told them at the time she would have got more CTC, or if she had no CTC (cos it's been overpaid and she didn't put a new claim in), she would have been entitled to more IS, but whether or not it will i don't know. i'm waiting for a reply on a different type of case of my own involving no overall loss to public funds. i think there's a reasonable chance the IR will do the right thing when cases are nice and clear, but i don't take any of this for granted. when cases are messier, for the variety of reasons they can appear less than clear cut, i think the risk increases.
the point is, this needs to be mandatory not discretionary. (see other tax credit threads).
the situation imo is actually much worse than this - it is actually very difficult for some people to comply with the IR rigid single/ couple definitions, because of the volatile and unstable nature of some relationships. Couple have blow up - husband walks out - wife doesn't see him for a few days - have they separated or not?
sometimes people separate, but neither partner wants it to be a permanent separation. they are hoping to work out their difficulties, but don't know whether they will or not. sometimes they reconcile, sometimes they part. what do you tell the IR?
if you run the risk of £3000 penalties on top of O/Ps the only way to remove the risk of non-compliance is to report everything to the inland revenue.
'dear inland revenue
i'm writing to let you know about my husband, who as you know stayed the night on Tuesday after getting upset about missing me and the kids, and i let him sleep on the sofa, because he's missed his last bus, and anyway was in no fit state, having drunk the 6 pack he brought with him, if you remember, which i told him was a bad idea at the time. he stayed at home all day Wednesday because as he said, he wanted us to try again to make a go of it, and he had a bad headache, and kept complaining of being confused, he didn't know what he wanted. i told him he wanted to lay off the beer. don't be like that, duck, he said, let's go to bed. he was trying hard, i'll say that for him - another time and we'd have ended up having a right barney. no, i said, i've got to finish this letter i'm writing to the inland revenue.
at that he stormed out of the house, muttering about me being no fun anymore, since i claimed the tax credit, and i've no idea where he spent Thursday night, or whether i'm separated or single. obviously, i'll keep you informed of any developments.
ps he's left a couple of pairs of socks behind, which i am going to wash, only because they're smelling the house out. i don't know if that's significant.
jj
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