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Around 50,000 new households a week are being hit with demands to repay overpayments of tax credits dating back up to seventeen years, it has been revealed.

As many as half a million households are now having their universal credit cut as a result of the drive by HMRC to recover historic debts, which are overwhelmingly due to failures on their own part to calculate the correct amount of tax credit due in the past.

HMRC has been trawling through records dating back to 2003 to identify errors. Demands for repayment ranging from as little as £5 to many thousands of pounds are being sent out whilst families struggle to cope with the effects of the pandemic on their income.

A Freedom of Information request has revealed that universal credit payments are being deducted to repay historic tax credit overpayments at a rate of 47,000 cases per week.

Deductions started on January 18 for new referrals to the DWP from HMRC for households which began claiming UC during the pandemic.

The total amount of debts related to tax credit overpayments is estimated to be £6 billion.

Claimants hit with a repayment demand are advised to seek help from a local advice agency.

Read the full story in the Mirror

Comments  

+1 #1 Crazydiamond 2021-04-15 12:20
This situation gives incompetent civil servants at HMRC and the DWP carte blanche to make mistakes with the correct entitlement to benefits, and many years later through no fault of their own, claimants have to have to pay it all back which in total could amount to thousands of pounds. They can plead hardship, but this is discretionary, and HMRC and the DWP rarely use this discretion.

In effect, what it does, it shifts the responsibility from the DWP/HMRC to the claimant, who has every right to expect that their award of benefit is correct. They are not benefits experts. Furthermore, if HMRC/DWP cannot get entitlement correct, why should the responsibility fall onto the shoulders of entirely innocent claimants?

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