In this section:
- How to avoid being paid too much or not enough tax credits
- You've been overpaid tax credits - how did this happen?
- Repaying overpaid tax credits
- Difficulty repaying overpaid tax credits?
- Tax credits - rights and responsibilities
- How to dispute a tax credits overpayment
How to avoid being paid too much or not enough tax credits
Tax credits are flexible and change when your life changes. If you tell us about a change, we work out the new amount of tax credits to pay you. Your new payments may mean we have been paying you too much money (an overpayment) or too little money (an underpayment).
Check the information on your claim form is correct
We use the details you give us on your claim form to work out your tax credit payments. You should carefully check that all the details on the form are accurate, complete and up to date paying particular attention to any dates and details of your income.
Check your tax credits award notice
When we first pay you, or make a change to your existing tax credit payments, we will send you an award notice. This tells you how much money you will receive based on the information you gave us.
It is important that you check your award notice when you get one. Use the checklist provided to tell us if anything is wrong, missing or incomplete, or if there's anything you don't understand. You can do this by calling the Tax Credit Helpline on Tel 0845 300 3900 or textphone 0845 300 3909. You should do this within a month of getting it.
We aim to send you a new award notice within 30 days of you telling us about a change. If you haven't received one, or if you're claiming tax credits for the first time, and your payments have started, but you haven't received an award notice, let us know as soon as possible.
Check the payments going into your bank account
It is also important to check the amount of money going into your bank account. Your award notice will show your first payment, plus the amount to be paid every week or every four weeks. If a payment doesn't match the amount on your award notice call the Tax Credit Helpline as soon as possible on Tel 0845 300 3900 or textphone 0845 300 3909.
Tell us about any changes in circumstance
When you tell us about a change in circumstance, we recalculate your tax credit payments for the whole year or from the date of your claim if you claimed part way through the year. It's your responsibility to tell us about a change that affects your tax credits, for example if you separate from your partner. If you don't, we won't know about it until you confirm your actual circumstances when you renew your tax credits after the end of the year. At this point we check whether the money you have received matches your income and circumstances. It may turn out that you have not received all the money you should (an underpayment). Or if you have received too much money (an overpayment), your current tax credits payments - if you still qualify, are usually reduced to repay the money.
Any change in circumstance that could mean your tax credit payments go up, such as having a baby, should be reported to us. It's better to do it straight away as any extra payments due can only be backdated by up to three months.
Any change in circumstances that could mean your tax credit payments go down, such as a child leaving full time education must be reported to us within one month or you could be paid too much money (an overpayment) and may also be charged a penalty of up to £300.
The checklist that came with your award notice will tell you which changes to report within one month of them happening. It's also a good idea to tell us about any other changes straight away to avoid an overpayment. You can tell us about any changes in circumstance by calling the Tax Credit Helpline on Tel 0845 300 3900 or textphone 0845 300 3909.
Renew your tax credits on time
The renewals process is a review carried out after the end of each tax year to make sure you have been paid the right amount of tax credits for the previous tax year and that we are paying you the right amount for the current tax year. A tax year runs from 6 April one year to 5 April the next.
We will send you a renewal pack between April and June. It's important that you give us accurate, complete and up to date information when you renew. The deadline for all replies to the annual review is shown on your Annual Review form (usually 31 July). The sooner you check your details and tell us of any changes, the sooner we can make sure you get the money you're entitled to. If you don't renew your tax credits, you may only receive payments for a limited period after the end of the tax year and you'll have to repay any overpaid tax credits.
You can contact our Tax Credit Helpline on Tel 0845 300 3900 or textphone 0845 300 3909 (open from 8.00 am to 8.00 pm, seven days a week except Christmas Day, Boxing Day, and New Year's Day).