Tax Credit overpayments - aaagh!

Posted by The Practitioner on Mon, 11/01/2010 - 21:04 in Blogs 1839 2 comments | report

There are one or two sagas running in my client list, and this Tax Credits appeal has to be the worst. He's loss-making farmer who has not paid tax for as long as I can remember – a classic case for tax credits, exactly the sort of individual they were designed for. And the subsequent events are exactly the reason why many of our eligible clients refuse to claim tax credits!

Some years ago we helped him claim Working and Child Tax Credits and he received the maximum. Then at some point around 2006 TCO decided they has overpaid him and his tax credits statements started to show an enormous amount to be repaid, although no steps were taken to try to collect it. We naturally wrote to TCO and queried this. The around a year ago they sent him a reminder about the overpayment and enclosed an official appeal form (I didn't know such a thing existed), which we lodged immediately with a 64-8 specifically covering tax credits – and heard nothing since.

Then, just before Christmas, he gets a phone call from HMRC debt management chasing repayment, apparently they have no record of any appeal! So we re-submitted it, and this time followed up with a phone call to ensure it had been received. A bit like sending a fax or email and then phoning the recipient to ensure they had received it! So we are still awaiting TCOs calculations to explain how and why they think they could have overpaid him. It beats me. This isn't the only tax credit appeal we have running - and they are all being ignored by TCO!

Comments

TCO Problems

stephenleonard | Tue, 12/01/2010 - 09:44 | Permalink

I certainly sympathise with the situation. I have had no end of problems with TCO and my current longest case is over 3 1/2 years old. We have appealed to everyone possible and in every possible way but we have been advised that it is a 'computer issue' which is preventing them closing the case.

It seems that I might finally have found someone with some sense who is going to try and basically override everything and do some sort of manual adjustment but I wont hold my breath.

Due to the complete incompetance of the TCO we issued them with a bill for our time spent and asked them to pay it/reimburse the client. This saga has been going on for over a year itself and I was eventually advised that our request was not going to be agreed as 'it was the taxpayers choice to engage an accountant when there were cheaper/free alternatives available' also that 'the charge for work done was not reasonable'. When i pushed them further to find out what would be reasonable in their eyes they basically ignored me. I have no appealed this decision to the Adjudicators office but this process could take a long time as well.

It seems obvious to me that the Tax Credit system was badly thought out, is badly run (mainly by ex benefit office staff who seem to have a loathing of professional advisors). The people who designed it have obviosuly never met a self employed person or understand how their income/profits are generated and calculated.

My approach now is to just be very beligerent and work on the basis that 9 times out of 10 I actually know the rules better than the TCO staff I am dealing with.

Phone communicator

Andrew Banks | Tue, 03/08/2010 - 03:08 | Permalink

Phone communicator are good in order to explain yourself, however a follow up letter and or email is a prerequisite to ensuring evidence of your phone call and discussion.

-- Andrew - Payday Bank

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