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HMRC internal manual

Claimant Compliance Manual

HM Revenue & Customs
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Undisclosed Partners: Recovery of Overpayments from18 January 2010 - Late Notification of an in-year change

We will consider remitting all or part of the overpayment where the customer is late telling us about a partner joining or leaving their household and all of the following apply

  • The change occurred in the current year and
  • A new correct claim has now been made and the award made and
  • The change occurred prior to the date for which the new claim is backdated
  • Where a customer fails to report a change in their household within 1 month of the date of change we can charge a penalty of up to £300, see CCM10150. (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Where you become aware of a late notification of an in-year change in the household you will need to follow the steps below.

Step 1

  • Advise the customer that the award will be terminated from the date of the change and that any tax credits paid since that date will be overpaid
  • Explain that they should now make a new claim in the correct capacity and advise them that if they do so you might be able to waive part of the overpayment
  • Issue the closure letter, amend the award and BF your case for 30 days

Step 2

  • During the BF period you should check to see if the new claim has been made and processed
  • If the new claim is not made within this period you can close and settle your case but if the customer then gets in touch to say they have not got their new award see the following point
  • If the new claim is held and an award has been made see step 3

Step 3

  • Use the SEES calculator to calculate the notional entitlement, see CCM15720 and then remit the appropriate amount of the overpayment using Make Remission - class 11. The balance of the overpayment will be repayable after the end of the tax year

There are two examples of a notional entitlement calculation at CCM15735