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HMRC internal manual

Claimant Compliance Manual

Undisclosed Partners: Recovery of Overpayments from 18 January 2010 - Examples as an in-year change

Example 1

Anna was awarded tax credits as a single mother from 16 April 2009. On 20 January 2010 Anna admits she failed to tell HMRC that Jim moved in with her on 15 August 2009. Anna tells you she did not report the change because they did not have a joint bank account so she didn’t think we regarded them as a couple. Anna and Jim now make a joint claim and it is backdated to 28 October 2009. Anna’s overpayment for 15 August 2009 to 20 January 2010 is £4,759.

Anna and Jim have made a new claim so you can calculate notional entitlement for the period 15 August 2009 to 27 October 2009. Had they made a correct claim they would have received £1,210.

The notional entitlement for 2009/2010 is £1,210 so you will remit the amount and we will recover £3,549 from Anna.

Example 2

Tariq was awarded tax credits as a single customer from 2 May 2009. On 21 January 2010 he admits he failed to tell HMRC that Sal moved in with him on 1 December 2009. Tariq says he didn’t think he needed to report the change until the end of the year. Tariq and Sal now make a new joint claim that is backdated to 1 December 2009. Tariq’s overpayment for 1 December 2009 to 21 January 2010 is £320.

Tariq and Sal have made a new claim so you can consider notional entitlement but there is no notional entitlement period, see CCM15720 because their new claim can be backdated to the date they began living together.