Understanding Tax Credits Overpayments to HMRC

If you discover that you’ve overpaid either child benefits, or working tax credits to HMRC, it’s your responsibility to notify them of the error as soon as possible to avoid a penalty. Since tax credits are means tested, and people’s life situations are in constant flux, it’s a typical scenario for an individual’s circumstances to change in a space of time which means the government is overpaying the state benefit. If it’s HMRC themselves who have found the error, they’ll write to inform you of that and explain how you should repay what you owe.

Adjustment of Ongoing Tax Credits

If HMRC has discovered a change in your circumstances that has resulted in the overpayment, they will adjust any current benefits until you’ve paid back the money you owe. They recognise that this may have serious effects on household expenditure, so this reduction is dependent on the household income of your family. For the up to date reduction figures, you can see this page here.

When you no longer receive tax credits

If you no longer receive tax credits, you will receive what HMRC term a ‘notice to pay’within a 30 day period of their discovery. This repayment is expected to be made at once and if, for any reason, you’re unable to do so should contact HMRC to discuss this with them. They are open to it being repaid over a longer period, but you’ll need to back this up with detailed savings and income figures.

The tax credits payment helpline

If you would like to clear tax credit overpayments sooner, you can contact the HMRC tax credits number to do so. Equally, if you’re finding it hard to make your payments, you should contact them to explain your situation, keeping your tax credit reference number to hand.

Telephone:
0345 302 1429

Opening times:

8 am to 8 pm, Monday to Friday
8 am to 4 pm Saturday
9 am to 5 pm Sunday

Once you’ve paid, it will appear on your bank account statement with the abbreviation NDDS, which stands for National Direct Debit System.

Call our Director’s Helpline

If you are a company in need of debt help, we offer a confidential helpline on 08000 746 757. We are specialists in all manner of HMRC tax issues, HMRC tax penalties, and debt recovery. Call now or try the live chat on the bottom right-hand side of the screen.

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