Tax credit overpayments Why are these a priority? HM Revenue & Customs (HMRC) may say that it has overpaid you Child Tax Credit or Working Tax Credit. These are priority debts because HMRC can take the following action. • Take money directly from your ongoing tax credit or Universal Credit award. • With your permission, take money directly from other benefits. • With your permission, reduce your tax code so that it can take money from your wages. • Use the same methods as for income tax debts, such as taking money from your bank account and using bailiffs. See Tax debts on page 63. • Ask the Department for Work and Pensions (DWP) to collect the debt in the same way as a benefit overpayment. See Benefit overpayments on page 65. What can I do? Contact HMRC as soon as possible. Ask for a copy of its code of practice: What happens if we’ve paid you too much tax credit?. It explains: • how HMRC can ask you to pay; and • that HMRC can decide not to recover the debt if the overpayment was caused by its mistake and you followed the rules to report any mistakes you noticed and any changes in your circumstances. Use the Summary budget for creditors to make an affordable offer. If you are in a vulnerable situation, for example, someone close to you has recently died, you are dealing with mental health issues or are elderly or sick, let HMRC know. Ask HMRC to take this into account in how it recovers the overpayment. If HMRC is taking money from your tax credits or Universal Credit award, check whether you can afford this. If the amount it is taking causes you hardship, contact HMRC and explain why. Send a copy of the Summary budget for creditors and ask if HMRC will take less. Page 64