Tax Credits: Challenging overpayments

Most advisers who deal with tax credits are likely to have dealt with a claimant who has been overpaid. The nature of the tax credits system means that overpayments are a natural part of it and can arise without fault by either the claimant or HMRC. However, many overpayments occur as a result of an error by HMRC or a mistake by the claimant.

There are six options that must be considered when challenging an overpayment. The options are not mutually exclusive, therefore it may be appropriate to pursue one, two, three or all of them, depending on the circumstances of each case.

The options are:

  1. Appeal
  2. Dispute
  3. Official Error
  4. Complaint
  5. Repayment/hardship
  6. Judicial Review

Last reviewed/updated 7 July 2016