Tax Credits - please explain what they are all about!

[chainsaw cat]

iirc, sas is the expert

i don't know, i just applied for my child tax credit today

ooohhh, me too.

Why can they only back date it 3 months when the revenue can come at ya for back tax from, like, a million years ago?

 

[chainsaw cat]

I'm a civil servant and literally 3/4 of my office is on these tax credit things.

Wouldn't it be cheaper for the government just to give them all an equivalent pay rise and scrap the paperwork?

In fact, shouldn't the govt. just stop taxing public servants, cut their pay by the same as their tax bill, and sack the appropriate number of revenue staff?

 

[ymu]

umm...yes they can.

Not quite true. They never were allowed to reclaim regardless but the rules were a bit shit. New rules came in earlier this year (listing responsibilities on both sides). If it's their fault, they're not supposed to be able to reclaim.


The new rules and a lot more discussion on specific circumstances are here:
http://www.newcastle.gov.uk/core.nsf/a/wr_bull2008_tcop_newcop26

Are the new rules an improvement?

The old rules were criticised for being too general and open to interpretation. The new rules try to be clearer by setting out specific situations where an overpayment may be recoverable. This is okay as far as it goes: They say that if the claimant fulfills all his/her responsibilities but the Revenue have failed in all of theirs, the Revenue should not recover all of the overpayment.

But what if there is failure on both sides? The Revenue say "We will look at the circumstances of your case and we may write off parts of an overpayment if we have failed to meet one or more responsibilities but you have also failed to meet yours." Still a large grey area.

How will this work out? Time will tell. But it is clear that the discretionary nature of Tax Credit overpayments recovery will continue to cause confusion and perceived unfairness. People will still need to use the procedure for challenging a Tax Credits overpayment recovery decision. And people will still need to seek advice.

 

[ethel]

Not quite true. They never were allowed to reclaim regardless but the rules were a bit shit. New rules came in earlier this year (listing responsibilities on both sides). If it's their fault, they're not supposed to be able to reclaim.


The new rules and a lot more discussion on specific circumstances are here:
http://www.newcastle.gov.uk/core.nsf/a/wr_bull2008_tcop_newcop26

yes, i helped to write that policy so i'm well aware of it

what i meant is that there has not been a blanket "amnesty" on TCs. some papers reported that there had been.

 

[ymu]

yes, i helped to write that policy so i'm well aware of it

what i meant is that there has not been a blanket "amnesty" on TCs. some papers reported that there had been.

Good of you to give such a full and frank explanation of it, when people are asking for clear information.

 

[ethel]

well, if the poster knew hey were being overpaid (as stated) and didn't inform hmrc, it is likely that the overpayment would be(at least in part) recoverable.

it's too late to go into tons of detail and you've already provided the like to the guidance anyway.

 

[ymu]

Too late my arse. I found that link on google in 2 minutes - I know fuck all about tax credits but I was interested to find out what Betty's mum had heard to make her think something that you said was untrue. You've replied since then - but it was too much trouble to even write "will post more tomorrow" originally.

You gave an extremely misleading statement and backed it up with your professional background. That's very poor, IMO. It's a minefield getting involved in threads here which relate to your job. If you do decide to get involved, it's a good idea to try and give clear and accurate information and especially to try to avoid misleading people.

We don't care where you work - we want accurate information. We don't care that you helped write a policy that "will continue to cause confusion and perceived unfairness" - we want to know what it actually means. Even mentioning that it exists would have been a nice gesture.

 

[Looby]

In fact, shouldn't the govt. just stop taxing public servants, cut their pay by the same as their tax bill, and sack the appropriate number of revenue staff?

Thanks for that. So as a civil servant on crappy pay, you would be happy for another civil servant on crappy pay to lose their jobs? I presume you're not a union member?

Possibly, you weren't being entirely serious, I hope not.

 

[LilMissHissyFit]

Sas is the xpert, but having alspo worked in the Tax Credit system I can tell you now that nobody really understands them. Certainly not the government which introduced them, hence the underpayments to some, overpayment and subsequent reclaiming from others causing them untold hardship.

There is a little exception thyeyve slipped into the "If we make a mistake" areas of their rules which says "If you knew or should have known you were being overpaid you have no right to stop us forcibly taking back your money" card.Which in practice means all they have to do is say "You should have known we had made a mistake, you should have told us you had been overpaid"

Thus, even the people who administer them dont know how how its calculated, its not really available freely to claimants... so you dont know you are being overpaid but miraculously "you should have known"and even if its their fault you have to repay.

They bullied me for over 2 years to repay an overpayment after I acted completely correctly. In the end I told them to take me to court for it as they kept threatening and we'd have a judge listen to us both and review the evidence..
Heard nowt since

 

[ethel]

that silly situation has stopped now under the new cop26. as long as the amount going into your bank matches the amount on your award notice and you've informed hmrc:

a) of any mistakes on the award notice
and
b) that the amount going into your bank isn't right.

then the overpayment shouldn't be recoverable.

there are definitely fewer "offical error" type overpayments than before.

the calculation link is posted above. actually the new hmrc site for tax credits is vastly improved and should answer most queries. it was appalling before.

ymu, sorry but all i said was "yes than can" not will. i thought that the op was referring to the section 18 issue. the only link i can find about it online, is a highly inaccurate story from the telegraph. http://www.telegraph.co.uk/news/uknews/1562041/andpound500m-tax-credits-could-be-written-off.html

this is far too complicated to try to explain at 2am.

 

[citygirl]

"the mistakes on the award notice" is what was causing the problems in the first place. what when *THE AWARD NOTICE* is wrong? and still matches up with your bank account, and you have done EVERYTHING you could to let them know it may be wrong?, but they're still saying "no, your claim is correct"...what then?? because that's what i suspect most people had a situation of, an overpayment of £2,000 is a lot to pay out of the next years award. (this was my problem in 2003-4) i ended up having only half of the award i should've had, even though it WAS their fault...i didn't have a choice in the matter, they took it out before i got it.

 

[ethel]

new cop26 again. hmrc have to act on any problems you report within 30 days. if not, the overpayment is written off. i'm not suee if you can ask for an overpayment from 03/04 to be reconsidered under the new cop26.

 

[citygirl]

i wrote it off before they'd even changed the rules. so, i doubt it too...but this is what we were all being told at the time. they didn't "discover" the overpayment until the end of year review, which is when *they* decided it was my fault, as i should've told them earlier.(more than 10 phone calls during the year querying the amounts)... it's so easy to hide behind rules that are written down to complicated that no *ordinary* person can make head nor tail of them...there are so many get out clauses that mean probably most people weren't even aware of their "rights"...if there WERE any...

 

[ethel]

if i were you i'd write to my mp explaining that you'd heard about the new cop26 and were wondering if if could apply to your overpayment.
phone he tc helpline and tell them that you wish to dispute. you can dispute at anytime, even if you have repayed part of the overpayment.

 

[mozzy]

I don't know that much about TC, but I was told that you have to work over 30 hours a week to be able to claim them (and over16 hrs if you are on DLA).

I claimed them in my last job and I was working 37 hrs p.w. I was told they are not for really for part time workers, but for low income workers. It annoys me that you have to be working over 30 hrs p.w. in order to claim them - if anyone knows any different, it would be good to know and I will go to my local JC and give them a piece of my mind as they will have misinformed me!

 

[citygirl]

the rules for single people are different to those with children. then you only have to get to 16 hours before it kicks in. and you get extra money if your hours are over 30

 

[Looby]

You have to be working over 16 hours to qualify for working tax credit but don't need to be working at all to get child tax credit.

 

[citygirl]

if i were you i'd write to my mp explaining that you'd heard about the new cop26 and were wondering if if could apply to your overpayment.
phone he tc helpline and tell them that you wish to dispute. you can dispute at anytime, even if you have repayed part of the overpayment.

cheers, for the advice. but i'm really not going to even attempt that. they "investigated" at the time, didn't make any difference. so that was that...and i'm really not into dredging it all up again with them. that was a previous life,(and my EX-husbands claim) and the year was just waaaay too traumatic on a personal level to go near it again...i was just pointing to it as an example...of course, i wasn't getting at you personally, but i've been in "the system" many years, and it's been a common problem for all of that time, people not being able to understand it completely, so that they're not duped...it's no wonder that CAB's are so busy (and always have been), they can't cope with the administration of these things either...

 

[ymu]

new cop26 again. hmrc have to act on any problems you report within 30 days. if not, the overpayment is written off. i'm not suee if you can ask for an overpayment from 03/04 to be reconsidered under the new cop26.

It appears that you can't.

What about people with challenges under the old rules?

We are told that if a recovery decision was disputed before 31 January 2008, the old rules apply. And continue to apply to further challenges.

There's new rules on hardship due to overpayment - although they appear to be a bit of a joke. Not clear if these will apply to hardship caused by cock-ups prior to February '08? It's written to let the Revenue decide. Obv.

Hardship? Reducing and writing off the overpayment

If the claimant can't meet his/her living expenses due to recovery of the overpayment, they may allow more time to repay the overpayment.

But in "exceptional circumstances" they "may write off the overpayment altogether."

The guidance offers no explanation about what this means. Except elsewhere it mentions "exceptional circumstances such as a family crisis." Maybe it means something worse than, or a combination of, the reasons they list for giving longer to repay. They have the discretion to decide.

http://www.newcastle.gov.uk/core.nsf/a/wr_bull2008_tcop_newcop26

 

[chainsaw cat]

Thanks for that. So as a civil servant on crappy pay, you would be happy for another civil servant on crappy pay to lose their jobs? I presume you're not a union member?

Possibly, you weren't being entirely serious, I hope not.

I'm jsut thinking of UK plc. Wouldn't it be better for civil servants to be doing something useful rather than pointlessly moving money from one account to another and then back again?

 

[ymu]

I'm jsut thinking of UK plc. Wouldn't it be better for civil servants to be doing something useful rather than pointlessly moving money from one account to another and then back again?

It would probably make things more complicated. They'd still have to record tax and NI for benefit entitlements, P45s and P60s etc. And money only moves on paper anyway, so it'd make bugger all difference. The government just gives you a payslip and pays you the bit that isn't tax. What's the difference?

 

[Sweaty Betty]

umm...yes they can.

what review are you talking about? renewal? if you have been overpaid, it'll be taken from ongoing awards.

They can bloody try- i told them of a change in circumstance last year- did they apply it?? No...

 

[ymu]

dp

 

[ymu]

They can bloody try- i told them of a change in circumstance last year- did they apply it?? No...

Then under the new rules it's their fault and they can't reclaim, but also under the new rules the old rules apply to overpayments which were disputed before February 2008 (I posted up a commentary on this point just above) - and the old rules were replaced because they were crap and unjust so you may have a fight on your hands.

You should probably get some proper advice if there's any threat of them trying to reclaim it - you won't get any choice if it's deducted from future payments and this incompetent shower of wankers will probably try it.

 

[Sweaty Betty]

Then under the new rules it's their fault and they can't reclaim, but also under the new rules the old rules apply - and the old rules were replaced because they were crap and unjust.

You should probably get some proper advice if there's any threat of them trying to reclaim it - you won't get any choice if it's deducted from future payments and this incompetent shower of wankers will probably try it.

I have "exceptional circumstances"

 

[ymu]

Nice one.

 

[Sweaty Betty]

Nice one.

My mum has just ended a two year witch hunt from them shower with the help of her MP and she had extreme circumstances they just didnt give a crap about

hopefully i will be much luckier- if its time to play the system- its now