Repaying Tax Credit Overpayment with a lump sum

[What should I do?]

I have been repaying my tax credit overpayment (from 2011-2013) at an agreed rate for the past 3 years & have another 7 to go

I may be on a position to clear the remaining debt with a lump sum payment in the next few months - does anyone know what happens then?

Will I drop off the Tax Credits system? (I no longer qualify to claim due to income) or

Will they assume I have access to endless cash & check claims prior to 2011 (they already know I can't prove an alternative address for my ex husband for this time) in the hope of reclaiming more money?

 

Also, as I was charged a penalty will my records have a 'fraud' marking? I was told this by the overzealous caseworker who sent my enquiry letter but have read elsewhere that if Tax Credits consider it to be a fraud case they would have done an interview under caution.

 

I really want to repay what I owe & never have to deal with them again but worry that by raising a lump sum I will trigger more interest.

[mikeymack2002]

Paying a debt over a long period could cause more issues.

 

Repaying in a lump sum will clear the debt, but you may have a marker put on your file. If you can afford to pay it off then I would. If you are in receipt of other benefits you would have to declare that money if it is finally yours...

[What should I do?]

Thanks, I don't (& never have) claimed any other benefits.

If I repay a lump sum will I still be on their system?

Who would have access to my file?

What issues do you think will be caused by paying over a longer period?

[mikeymack2002]

Data sharing is the norm now so all agencies could get to see it.

 

Longer time paying means less cash each week/month.

 

Clearing a debt faster is only advisable if you can afford it. If not continue at the rate as arranged..

[What should I do?]

The money will be a loan from family so I will have to repay but without the annual repayment review!

I have recently started work for another government department - do you think info will automatically be shared with them or only if they ask?

It's taken a long time to get my finances/life back on track & now worry I could lose my job if it looks as though I committed fraud.

[mikeymack2002]

There could be a danger of the HMRC getting an attachment of earnings (AoE) against you as you may be able to clear the debt quicker this way. (A possibility)

 

Then if they do your employer will be notified, as they would have to deduct it from your salary. So with 7 years to pay would you prefer it over and done with or repay family members?

[What should I do?]

I do want to repay ASAP & hadn't considered them doing an attachment - I will call them as soon as I have access to the money & hope that will be the end of it.

Even without the loan I would be able to increase payments & clear the debt within 2 years but don't want to be on their 'active' case list any longer than necessary!

Thanks for replying.

[blondebubbles]

If you repay an overpayment, the claim you had will still be there. They can't simply delete it as a record must be kept of all claims made.

 

Tax credits overpayments are not repaid through attachment of earnings but can be taken back through your tax code.

[What should I do?]

That makes sense Blonde bubbles as the system will need to flag up the record if another claim is made.

 

Once an overpayment is repaid in full do you know if they ever revisit the claims & check earlier years?

They already know that I can't prove my husband's whereabouts prior to 2011 & if I pay them a lump sum there is no way I can afford a further overpayment & repay the family loan.