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HMRC internal manual

Child Benefit Technical Manual

HM Revenue & Customs
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Misrepresentation and failure to disclose - General Considerations: Causation

SS A Act 1992, section 71, SS A Act (NI) section 69

Duggan v Chief Adjudication Officer

R(SB)3/81, R(SB)21/82, R(SB)15/87

For an overpayment to be recoverable, Her Majesty’s Revenue and Customs have toshow that it was caused by

  • a misrepresentation, or
  • a failure to disclose a material fact.

An overpayment may have more than one cause. There may be various events which, had they occurred, would have prevented an overpayment. Provided that one of those events is a failure to disclose or a misrepresentation by the claimant or person acting on their behalf, the overpayment is recoverable.

Causation (continued)

The causal link is not broken where the department

  • fails to make the necessary enquiries
  • makes wrong assumptions about the claimant’s circumstances which give rise to an overpayment, or
  • performs their duties negligently in some way. For example, fail to link two cases in the same household or fail to act on information provided by a third party.