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Written question asked by Louise Haigh (Labour) on Wednesday, 4 November 2020, in the House of Commons. It was due for an answer on Monday, 9 November 2020. It was answered by Will Quince (Conservative) on Tuesday, 10 November 2020 on behalf of the Department for Work and Pensions.

Welfare Tax Credits: Overpayments

Question

To ask the Secretary of State for Work and Pensions, what assessment she has made of the effect on tax credit claimants of the closure of the interface with HMRC on tax credit debt.

Answer

As part of our initial response to the Covid-19 pandemic we suspended recovery of all overpayment deductions as well as pausing notification of any new overpayments. The transfer of Tax Credit debts from HMRC to DWP was temporarily suspended as part of this approach.

Recovery of existing Tax Credit overpayments from Universal Credit has now resumed, along with the transfer of new Tax Credit debt to DWP.

There have been several discussions with HMRC, who own the Tax Credit Debt, to ensure that both the action of stopping tax credit collection and restarting has taken into account the customer perspective.

We want to ensure that repayment of all debt owed to the Department is sustainable and takes into account the customer’s ability to pay. Claimants are encouraged to contact DWP if they are unable to afford the rate of recovery. The recovery rate of Tax Credit overpayments can be reduced where a claimant is experiencing financial hardship.

Secondary information

Type
Written question
Reference
111573
Session
2019-21
Subjects
Debts Overpayments Welfare tax credits
Link
View this Written question on www.parliament.uk