Suggested Steps To Disputing A
Tax Credit Overpayment Bill

PLEASE NOTE: if you have a Tax Credit court case pending against you, see Stopping Court Cases for emergency steps to get the court case stopped!

Please be aware that Disputes and Appeals are different processes. You can only Appeal if you have what’s called an ‘entitlement issue’. These are where you think HMRC have ruled wrongly on an element of your entitlement. (i.e. they have your number of working hours / children / other circumstances wrong. e.g. they claim you only have 1 child when you have 2, or that you weren’t working enough hours when you were). The Appeals process is more straightforward and often fairer for the claimant, so do ask yourself; ‘am I arguing with HMRC over entitlement?’ If the answer is yes; Appeal instead. To deal with an Appeal, please go to this site.

The following guide describes the more complex Dispute process only, because the majority of overpayments can only be dealt with through the dispute process.

Note that there is not actually a very well defined route through this process. Sometimes you may be bounced back and forth, out of order, but during that time they cannot (read "should not"; but you can get it stopped if they try) recover money, add fees or summon you to court. Although this guide seems long, you do not have to do everything at once. Most of it is waiting for one stage to finish before another one can start.

A couple of tips for you:

  • When writing dispute letters aim to get them to give you the answers to what happened, when, even if it only comes out at that stage’s refusal, because then you can use that information for the next stage. Get them doing the leg work, not you.
  • Defend yourself on the basis of HMRC’s claims against you. i.e. don’t fight points they aren’t trying to blame on you. However, do include any HMRC mistakes, whether they acknowledge them or not.
  • Keep your points relevant. HMRC are looking to blame you because apparently you ‘should have known the award payments were wrong’. Discussing political opinions, other benefits you have or haven’t had problems with, or in-depth details of your employment or personal life will only be ignored. However if you suffered mental heath problems, loss of a loved one, major illness or other trauma around the time the overpayment occurred, do make sure to emphasise this. Most of the dispute will focus on whether you met the responsibilities outlined in COP26. (see page 3 of COP26).
  • Deadlines issued by HMRC are deadlines to respond, not repay. So if a letter demanding recovery states a deadline make sure to contact them by that date to say you are continuing to dispute.
  • Do not discuss details of a dispute over the phone with HMRC. Ring to inform them a dispute is on the way if you’re cutting a deadline fine, but do not handle the dispute over the phone, regardless of who rang who. You have a far better record of who said what / when if you deal with everything by letter. You also have far more time to compose your answers and focus on the issues properly. Don’t let them catch you in a rush.
  • Don't let them in if they turn up on your doorstep (tell them you are in dispute and will not discuss it in person) and do not agree to a meeting. Insist the dispute be handed in writing if they try either of these. It’s rare that they attempt this, but forewarned is forearmed.

There are also Other Organisations that can give you information and guidance about Tax Credit Overpayments, and the Government website 'Directgov' has a page about How to Complain to HMRC.


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