HM Revenue and Customs Brief 40/14 - recovering tax credits overpayments
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7 November 2014
Purpose of the brief
To provide an update on changes to how HM Revenue and Customs (HMRC) will
recover some tax credit overpayments.
Advisers and intermediaries who may deal with tax credit
is changing the way it recovers tax credits overpayments.
Claimants who have been overpaid tax credits may have their
tax credits award reduced to repay outstanding debts from previous
Depending on a personís circumstances, outstanding
overpayment(s) may be from one or more previous awards.
will continue this recovery until the overpayment(s) is repaid or the
claimant is no longer entitled to tax credits.
will send a revised award notice to the claimant when it starts to
recover overpayment(s). This will tell the claimant how much they owe
and how it will affect payments.
wrote to claimants about these overpayment(s) at the time it identified
them. If claimants have an arrangement in place to repay debts they
will not be affected by this change.
will apply a different rate of recovery depending on a householdís
circumstances and income. Those on lowest incomes will have their debt
repayments spread over a longer timeframe.
The maximum recovery rate is 25% of current payments; however
households with a limited income who are receiving a maximum tax
credits award may only experience a 10% reduction in payments.
Claimants suffering severe hardship can contact the Tax Credit
Helpline on Telephone: 0345 300 3900 (Textphone: 0345 300 3909) to
discuss their individual circumstances and any help that may be
For more information read Tax
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Article Published/Sorted/Amended on Scopulus 2014-11-10 09:00:19 in Tax Articles