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HMRC internal manual

Claimant Compliance Manual

Closing the enquiry: who will meet the settlement?

Who will meet the settlement will depend on the circumstances of the case.

  1. Single customer - in these cases your settlement can only be with the customer. The position is the same even if the reason for the settlement is you have established the customer was living with someone. The newly discovered partner can never be asked to meet the settlement or even help towards it but see CCM 8430 regarding the means of the single customer.
  2. A couple who are now separated - although they made the claim as a couple and the legislation provides for them to be jointly and severally liable for the overpayment and the penalty. However, if they are separated by the time you come to settle the enquiry you must split the settlement between them.
  3. A couple who were both aware of the incorrect claim - Where the couple is jointly and severally liable to repay the overpayment and are both considered to be guilty of fraud or neglect, you will be seeking a joint letter of offer. This will be in both of their names and will be signed by both of them. If this is accepted, the settlement charge, the letter (This content has been withheld because of exemptions in the Freedom of Information Act 2000)  will show both of their names and the recovery officer will then pursue either of them or both of them to settle the charge.
  4. A couple where one is an innocent partner - where you are satisfied that one of the partners did not know about the fraud or neglect, you must not ask that partner to repay the overpayment or pay a penalty. The settlement must be with the other partner as if he/she was a single customer.

In some cases there might have been more than one error and it is possible for a partner to be aware of one error but not another error. In these cases you will need to split the overpaid credits and penalties between them in a reasonable manner.