Payment processing and accounting: payment allocation, overpayments and repayments: Duty Repaid In Error Refunded (DRIER): repayments to agents and third parties
In the first instance you should always write to the payee. If the payee is an agent or a third party receiving payment on behalf of the customer, use the DRIER20 Notice to Repay - Agent letter. All subsequent contact and charges should be with the agent/third party.
If payment is not offered voluntarily, a DRIER charge will always apply to recover the debt where the over-repayment was made to an agent/third party - see DMBM215200.
If the agent/third party tells you that the repayment has been passed on to their client, send the DRIER10 Notice to Repay- letter to the customer, unless form 64-8 is held as detailed below.
All subsequent contact and charges should be with the customer. Section 29/30 TMA 1970 provisions may apply in these circumstances. See DMBM215180.
The following guidance covers the most common scenarios. Where:
- the agent has retained/not passed on the repayment, pursue the agent for reimbursement/raise a charge against the agent
- the agent has passed the full amount of the repayment on to his client:
- it will be necessary to check whether a form 64-8 is held
- we can legitimately recover from the client provided that the agent had authority to accept repayments on behalf of his client
- if the agent has authority to accept repayment then he will legitimately have accepted for his client and the client should pay
- payment made to the agent and no 64-8 is held, the agent does not have the legitimate right to accept the repayment or pass it on; in this case we can legally pursue the agent as repayment has been made to him in error, even if the payment has been passed to the client
- the agent passes the repayment on to his client after a DRIER charge has been raised against the agent, subject to the ‘authority check’ above, cancel the SAFE charge against the agent and re-raise against the client
- the agent has passed on only part of the repayment to the client (because he has retained some for outstanding fees), because the client has received full benefit of the payment, through off-set against fees and receiving part of the repayment directly, the full charge should be made against the client.