I’m being threatened with court action if I do not repay a tax credit overpayment within 12 months! Can I do anything to stop them?

Question – “I received a bill from the HMRC who said I had been overpaid around £18,000 in tax credits. When I spoke to someone on their debt management team, I was told that this had to be paid over the next 12 months or I would be taken to court. This is really worrying me as I am already struggling financially as it is!

Because I am considered a higher-earner (at £46,000 per year), this is the reason why I am being given such a short period of time to make the repayments. I know it’s my fault for not declaring exactly how much I was earning to them, but amount of time I have to repay it back in seems a bit unfair to me.

I have already been through the disputes process to see if I can get myself more than 12 months to make repayments – the thing is I can only afford around £50 per month as I have a lot of other outgoings, including some other debt management plans which take up most of my spare cash.

If I am to pay this back in 12 months I am looking at having to find £1,500 spare each month – a figure I just don’t have! Can I stop them from demanding repayment this quickly and taking me to court?”

Answer –  You cannot stop HMRC taking you to court but you can try dissuade them. If they do and get a judgement against you, (a CCJ), your ability to repay is affected, and that helps nobody, the key is to start making payments now however small. Also watch out for the criminal side because if they think you were guilty of fraud they can prosecute.

At Hylton-Potts we are experts at dealing with problems like this and have a free email and telephone helpline