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Forum Home  →  Discussion  →  Income support, JSA and tax credits  →  Thread

tax credit overpayment and the death of a joint claimant

Cordelia
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Welfare rights officer - Wrexham Council Welfare Rights Team

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I have a client who was married until her husband passed away a few months ago.  She worked and he was disabled.  They made a joint claim for working tax credits (no children) and the money was paid into his bank account.  She tells me that she forgot about the claim and can’t remember getting any annual renewal notices.

For various reasons they were overpaid in several tax years from 2013 onwards.  The overpayments were recovered from their ongoing award. 

After her husband passed away, the joint claim ended.  HMRC are now asking my client to repay the whole overpayment.  We have written to HMRC and received a stock response about time limits. 

I don’t think we have a very strong argument for a dispute anyway - my client didn’t keep track of the claim and HMRC did meet their responsibilities.  What I am surprised by is that they are asking her to repay the whole amount.  If a couple split up the debt is split between them, so why not when a couple is separated by death?

The husband has left other debts, which I suspect will be more than the value of his estate.  My client has some assets so would not want to look at a debt relief order.

Does the idea of asking HMRC to only chase her for 50% of the debt sound reasonable? 

ClairemHodgson
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Solicitor, SC Law, Harrow

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For various reasons they were overpaid in several tax years from 2013 onwards.  The overpayments were recovered from their ongoing award.

After her husband passed away, the joint claim ended.  HMRC are now asking my client to repay the whole overpayment.  We have written to HMRC and received a stock response about time limits.

if overpayments were recovered from the ongoing award, what further overpayment remains to be recovered?

Jon (CANY)
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Welfare benefits - Craven CAB, North Yorkshire

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I read it as “were in the process of being recovered”?

Anyway, as far as I know, the apportionment concession is just for separating couples, given the description in COP26, and the way it has been described on revenuebenefits.org.uk. Also, HMRC guidance indicates that 100% of the debt is passed on to DWP in these circs for recovery from UC or whatever, see Step 16 here: https://www.gov.uk/hmrc-internal-manuals/tax-credits-manual/tcm0040020

Presumably the executor can at least put the full debt into whatever pro rata payment creditors are getting from the residue of the estate, to reduce the amount owed by the surviving partner.

ClairemHodgson
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Solicitor, SC Law, Harrow

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Jon (CHDCA) - 04 May 2019 01:51 PM

I read it as “were in the process of being recovered”?

a different thing from “had been”

this is the lawyer in me ....

no doubt we’ll learn which it is on Monday! :-)

Cordelia
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Welfare rights officer - Wrexham Council Welfare Rights Team

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It should have read “were being recovered”.  That will teach me to post in a hurry on a Friday afternoon…

ClairemHodgson
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Solicitor, SC Law, Harrow

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Cordelia - 05 May 2019 11:03 AM

It should have read “were being recovered”.  That will teach me to post in a hurry on a Friday afternoon…

LOL

some maths needed, clearl,y to work out what had already been recovered and what remained to be recovered…..