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Overpayment Of Wages affecting UC
Hi - Wages overpaid in December - UC used actual income for the MAP
Employer is recovering this from ongoing wages and UC are not deducting this from wages for UC assessment ongoing…
Any help???
Hi - Wages overpaid in December - UC used actual income for the MAP
Employer is recovering this from ongoing wages and UC are not deducting this from wages for UC assessment ongoing…
Do you mean that UC is adding back in the recovered amount or is the employer making the normal payment, passing that figure to HMRC and then making the deduction?
Hi - Wages overpaid in December - UC used actual income for the MAP
Employer is recovering this from ongoing wages and UC are not deducting this from wages for UC assessment ongoing…Do you mean that UC is adding back in the recovered amount or is the employer making the normal payment, passing that figure to HMRC and then making the deduction?
Yes they are using the amount she would have received before the OP is recovered
Who are ‘they’ and where are they getting this figure from?
I assume they (UC) are getting it from the RTI figure, as supplied to HMRC by the employer.
Have had a few of these.
The problem is (I think) that the overpayment deduction isn’t one of the things UC can deduct under reg 55(5).
The client got less UC that normal when the op of wages happened, but got more in wages. In this AP, UC are treating them as if earning their normal amount.
So overall, client ends up with the same amount of wages as if the op hadn’t happened (once all the op is repaid), but less UC. The only thing I can think of is to say to the employer that this loss is as a result of their error, & complain to see if they will let the client off some of the repayment.
The amount of UC lost is of course not as much as the op because it’s not a £1 for £1 deduction so they might consider it? The other solution (which I think you are getting at Gareth?) is that the employer doesn’t put this through as if the client was paid their normal earnings & then a deduction was made, but just pays them less (so that UC take into account their actual net earnings). But in this case sounds like it is too late for that now.
If, on the other hand, the client wasn’t on UC when the overpayment of wages happened (which is a scenario I’ve also seen), it is going to be harder to convince any employer to help in this way (as the earnings work out the same and the UC loss in this AP is more than made up for by having had the benefit of all the additional earnings when overpaid - though of course from a budgeting point of view that doesn’t help the client).
[ Edited: 28 Jul 2022 at 01:05 pm by WillH ]This has been discussed previously.
An employer can do one of two things in this situation. The best way to deal with it is to deduct the overpayment from GROSS PAY, in which case UC will reflect the deduction correctly.
Alternatively, they can amend the payroll to reflect the fact that the original overpayment was not wages (effectively, they would be saying that it was a glorified loan, not wages, nor even a payment on account of earnings), and deduct it from NET PAY in the current pay. If they’ve done this then your client should raise an RTI dispute against the original AP to get the income figure used for that month corrected.
An employer CANNOT leave the payroll as it was, and then deduct the overpayment from NET PAY. If they were to do that then besides for UC being affected, tax and NICs would also be wrong.
[ Edited: 28 Jul 2022 at 01:28 pm by Charles ]