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Tax Credit case summary 8
Mrs H submitted a single claim for Child Tax Credit (CTC) after she and her husband had split up. This was put into payment in April 2004. In October 2004, Mrs H received a questionnaire from the TCO to find out about the care arrangements for her son. Unbeknown to Mrs H, her ex-husband had also made a claim for CTC for their son, in May 2004. Where more than one person has claimed for the same child, and it seems there has been no agreement between them who should receive the CTC, the TCO will make the decision. In November 2004, the TCO decided that, as Mr H was responsible for their son three hours more per week than Mrs H, then he should receive the CTC, rather than her. Therefore, they asked Mrs H to repay all the CTC that she had received in the 2004/2005 tax year, amounting to more than £1,300. Mrs H subsequently disputed the overpayment as she felt it was unfair that she should have to repay it, when she had not known that her ex-husband had also submitted a claim. When the TCO dealt with her dispute, their decision letter told her that the overpayment had arisen for different reasons, namely that she had claimed as a single person but had been living with a partner. Not surprisingly, Mrs H was upset by this, and she considered that her dispute could not have been properly considered. The TCO later apologised for having given her the incorrect reasons for the overpayment, but told her that they felt it was recoverable, as she had been found not to be the primary carer for her son, and therefore it was not reasonable for her to have considered the payments she received were correct.
We substantially upheld Mrs H’s complaint. We found that the TCO had not followed their procedures correctly after Mr H made his claim, and this led to a significant delay in Mrs H being aware that there might be any problem with her own claim. Therefore, we recommended that the TCO write off the part of the overpayment which arose during this period (approximately £900), and that they pay some compensation for the worry and distress caused by the way they handled her dispute of the overpayment and her direct costs, totalling £60. We also asked the TCO to look at their procedures to resolve disparities with the way that the Child Benefit Office (which is also part of HMRC) deals with similar issues.
