Advice on Tax Credits

Many thousands of Usdaw members have received a welcome boost to their household income by claiming Tax Credits, but recently some members have been told they have received an overpayment.

This can be very upsetting and the unexpected drop in income can cause real hardship.

The amount of Tax Credit you are entitled to is usually based upon your gross income and there is a strong chance that your income will change after your claim has been assessed (for e.g. if you get a pay rise) and this might affect your entitlement. Your childcare arrangements may also have changed.

If you tell the Inland Revenue about changes in your income they can adjust your award straight away. You must tell them about certain changes – for example, if your income goes up by more than £2,500.

The Inland Revenue has said that it will not recover overpayments where:

- The overpayment was caused by their mistake and

- It was reasonable for you to believe your award was right.

They are also able to exercise their discretion and ‘waive’ their right to recover all or part of the overpayment where you can show that paying back the overpayment will cause you real hardship.

If you disagree with a decision to recover overpaid Tax Credit then you should appeal within 30 days of the date on the letter informing you that you have been overpaid.

Here are some useful addresses, helplines and web sites.

- Contact the Tax Credit Office, Inland Revenue, PO Box 145, Preston PR1 0GP. Helpline number 0845 300 3900 or visit www.inlandrevenue.gov.uk/taxcredits/

- The Inland Revenue leaflet If You Think a Tax Credit Decision Is Wrong tells you more about your rights of appeal and includes an appeal form. It is available from www.inlandrevenue.gov.uk/pdfs/wftcap.pdf

- More detailed information can be found in the Inland Revenue’s Code of Practice What Happens If We Have Paid You Too Much Tax Credit, available from www.inlandrevenue.gov.uk/leaflets/cop26.pdf

Notes to Editors:

• Usdaw (the Union of Shop, Distributive and Allied Workers) is the UK’s fifth biggest trade union, with over 338,000 members. Most Usdaw members work in the retail sector, but the union also has many members in transport, distribution, food manufacturing, chemicals and other trades.

• More information and news releases are available at our online Newsroom.

• Journalists can subscribe to receive Usdaw news releases via our online e-news service.

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© 2003 (USDAW) Union of Shop, Distributive and Allied Workers
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