Tax Credits and Stop Notice - should it be immediate?

The TCO continued to make a number of CTC/WTC payments following the client’s UC claim.  I’d (wrongly?) presumed the DWP stop notice would be immediate and transmitted in real time.  Now the client has nearly £700 of TCs overpayment which will be recovered by deductions from her UC award. 

In your experience, is this unusual? Has anyone had any joy in challenging TC overpayments arising in this situation?

Thanks in advance

All HMRC overpayments are recoverable, however you can ask them to use discretion to reduce repayment.

There should have been a stop notice sent immediately upon UC claim, and if HMRC failed to act on it you could argue that they didn’t meet their responsibility.
Claimant might be able to argue that s/he met his/her responsibilities by claiming UC - which should have served as notice to HMRC.

Alternatively, you can ask HMRC to reduce repayment on grounds of hardship and/or mental ill health if it applies.

I have an ongoing case where we’re trying to secure compensation from DWP to cover an overpayment of tax credits as the stop notice wasn’t sent by DWP for nearly 3 months after the claimant had claimed UC.  The claimant had contacted HMRC but they said they could only act on a stop notice.

Mairi - 12 March 2020 05:14 PM

I have an ongoing case where we’re trying to secure compensation from DWP to cover an overpayment of tax credits as the stop notice wasn’t sent by DWP for nearly 3 months after the claimant had claimed UC.  The claimant had contacted HMRC but they said they could only act on a stop notice.

Gosh that’s awful, especially as your client tried to stop the TC payments!  Did you try disputing with HMRC too? When I spoke to the intermediary line,  they said they had a liaison arrangement with the DWP so could still dispute the overpayment with them although the debt had already passed over to the DWP.  If the outcome was favourable the liaison team would ensure the customer hadn’t lost out (not sure how!)

I’m confused because i was once under the impression that stop notices were automated once the claimant’s ID was confirmed to HRMC and similarly for the other legacy benefits within the DWP and to LA’s?

That said overpayments are seemingly part of the structural architecture of UC i.e. unavoidable as opposed to endemic for client’s migrating.

Are stop notices automated or semi-automated or manual? 

Can anyone shed any light on this?

I’ve put in an FOI etc etc….............