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Tax Credit Overpayment Recovery Upped To 50% Of Award.

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Standby for a sad face on question time tonight
http://www.bbc.co.uk/news/business-35985360

Families who have been overpaid tax credits will have to repay the money at a much faster rate from now on, under government changes.
Tax credit claimants with a household income of more than £20,000 will see any historic overpayments clawed back at a much faster rate.
The UK tax authority said this would cut the time that people spent in debt.
But campaigners have argued that some claimants will face "serious financial hardship".
Paying back
Entitlement to tax credits - a top-up for those on low incomes - is generally calculated by referring to a claimant's previous year's income.
Sometimes, pay rises or more hours of work mean that claimants may receive too much from the tax credits top-up. This money then needs to be repaid to HM Revenue and Customs (HMRC).
The amounts of overpayment can sometimes be quite high, but families may have spent the money, so find it difficult to repay.
Repayments are often made by reducing subsequent tax credit awards, and it is this cut in payments that has been changed.
Previously, payments were reduced by a maximum of 25% in order to pay back outstanding overpayments.
Under changes newly in force, but announced in the March 2014 Budget, those who still owe money to HMRC will see their latest tax credit award cut by up to 50%, if they have a household income of more than £20,000.
It is understood that HMRC want to retrieve previous overpayments quicker, so the books are settled before benefit claimants move over to the new system of Universal Credit.

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Again we see extreme vehement resistance to any changes to the Tax Credit system.

It just shows how many people are in reciept of it and probably relying on it.

Nevertheless it's time to pay up.

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Again we see extreme vehement resistance to any changes to the Tax Credit system.

It just shows how many people are in reciept of it and probably relying on it.

They're part of the modern entrepreneur in the UK today - Tax Credits, BTL and a newly created public sector management non-job - all of which are utterly unsustainable.

Edited by rantnrave

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A system that should never have been allowed to exist in the first place. All it does is obfuscate the state of pay and income. If people are genuinely poor when working, that should be addressed by fixing the economy so work pays,or simple stated benefit payments. The only reason TCs are a thing are to entrap as many people as possible into being clients of the state.

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A system that should never have been allowed to exist in the first place. All it does is obfuscate the state of pay and income. If people are genuinely poor when working, that should be addressed by fixing the economy so work pays,or simple stated benefit payments. The only reason TCs are a thing are to entrap as many people as possible into being clients of the state.

Vote for Gordon!

Vote for Gordon!

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As someone who was caught by changes to tax credit (what a bonkers term). The rate that HMRC can claim it back is limited by being unable reduce my tax code any lower. I wouldn't mind but I tried and tried to stop them giving the tax credit in the first place, like they suggested but as they don't employ anyone with more than half a braincell it just kept coming until the chancellor pulled the plug. Of course as we have negative interest rates maybe he intends to bring in negative tax codes. AK47 anyone?

Chickens coming home to roost!

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As someone who was caught by changes to tax credit (what a bonkers term). The rate that HMRC can claim it back is limited by being unable reduce my tax code any lower. I wouldn't mind but I tried and tried to stop them giving the tax credit in the first place, like they suggested but as they don't employ anyone with more than half a braincell it just kept coming until the chancellor pulled the plug. Of course as we have negative interest rates maybe he intends to bring in negative tax codes. AK47 anyone?

Chickens coming home to roost!

They already do have negative tax codes. They end in K IIRC

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As someone who was caught by changes to tax credit (what a bonkers term). The rate that HMRC can claim it back is limited by being unable reduce my tax code any lower. I wouldn't mind but I tried and tried to stop them giving the tax credit in the first place, like they suggested but as they don't employ anyone with more than half a braincell it just kept coming until the chancellor pulled the plug. Of course as we have negative interest rates maybe he intends to bring in negative tax codes. AK47 anyone?

Chickens coming home to roost!

The Revenue should never have been involved in benefit payments in the first place. The job was foisted on them by Gordon Brown. These debts are now in the process of being transferred back to the DWP as Universal Credit is slowly rolled out. In fact all of Brown's toxic legacy is being unwound now the Master of Disaster has gone.

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