JR against a very old tax credit overpayment recovery

Hi all, hoping for a reply from Jess Strode but also from any/everyone else who can help
Friend on UC has just had a recovery for a supposed old tax credit debt taken from her UC claim.  UC initially said it was a HB overpayment before backtracking and saying it is an old tax credit op.
Her youngest is now in his late twenties!  She clearly recalls that the only tax credit issue it could be goes back until about 2003/4 and had a home visit from one of the few welsh speaking tax credit people who confirmed at the time that there was no overpayment.  Obviously, as is usual, she can get no info/contact with UC debt recovery.  Therefore I am going to help with a JR pre-action letter.
I recall that way back when there was a date that tax credit overpayments from a certain length of time ago could not be recovered - can anyone remember this and link me to the info
Has anyone got a template JR letter for UC stated they cannot recover an old debt that they cannot provide any information about it’s actual existance or not
Need to get recovery stopped asap as she has not enough left to live on
Cheers

Hi Vonny - the HMRC annual report and account 2011-12 states at para 9.10 -

A key aspect of the tax credit Debt Strategy for 2011-12 was to address the older inactive debts that were not in a Time-to-Pay arrangement. Earlier in the year, and following consultation with the NAO, we conducted an
extensive exercise to test how successful we might be in pursuing inactive debts and to identify the associated costs. This resulted in a recommendation to remit all inactive debts over 3 years old. The exercise resulted in remissions totalling £1.22 billion involving over 1 million aged and inactive overpayments

So I’m guessing your client’s debt should have been written off

And Amber Rudd said in April 2019 -

Having consulted with my officials, I am pleased to confirm that the Department does not chase debts once they have been written-off. Once a debt has been written-off, it is zeroed on our systems to ensure no active recovery can take place. The only exception where we might seek to recover previously written-off debt is where debt attributed to official error later transpires to be the result of fraud. In such cases we reverse the write-off and pursue recovery

Unfortunately parliament.uk has changed a lot of its links and so it no longer works but i’m sure the letter could be traced if necessary

Thanks Daphne
I am so glad I did not make this up

Here’s Parliament’s new link to Amber Rudd’s letter:

https://old.parliament.uk/documents/commons-committees/work-and-pensions/Correspondence/Amber-Rudd-SoS-historic-welfare-debt-collection.pdf

I can’t recollect if HMRC contacted the 1 million people referred to.

I think we are going to ask HMRC about this via the consultation group. HMRC have always used ‘remit’ and ‘write-off’ to mean two different things. So when someone disputes an overpayment and is successful, the debt is written off and can’t be resurrected. They write-off in exceptional debt cases involving mental health as well. But remittance is not the same as a write-off (or so we have been told by HMRC previously) . Their overpayment/debt recovery guide used to say that remitted debts remain legally recoverable and that if the person’s circumstances change or they starting getting tax credits or UC, then recovery would recommence.

I’m interested to hear how you get on with this.

I would echo the above from LITRG. From my (albeit limited) experience HMRC policy appears to be to suspend recovery until the following year when they will review the circumstances and possibly suspend again. I’m guessing that this is what they mean by “remit” and with the intro of UC they are using this an excuse to get their money back / recover old debts. I had one client who had a virtual annual appointment with me over exactly the same TC debt which they would seek to recover every year, despite acknowledging the client was not at fault. One for the MPs to sort out, I guess.