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HMRC internal manual

Debt Management and Banking Manual

Debt and return pursuit: Child Benefit overpayments: recovery from continuing entitlement: general

Direct recovery from Child Benefit payments

Recovery from continuing entitlement is where a Child Benefit overpayment is recovered direct from ongoing Child Benefit payments. This can be at the full rate of benefit or at a reduced amount.

Where a deduction in Child Benefit has been made in order to recover an overpayment, care should be taken to ensure that there is no interruption to any Child Benefit payments due.

While recovery is in progress, Box D of the customer’s Child Benefit account will reflect the weekly rate of recovery and the date recovery commenced. A maximum of two such entries may appear in Box D at any time. If a third recovery rate is input, details of the first rate will be automatically erased.

In view of this, whenever details of recovery need to be calculated, you should make reference to:

  • the recovery rates shown in Box D
  • the information held on OPREC.

Change in circumstances notified by Child Benefit Office

There may be a change in the customer’s circumstances that may affect recovery; for example:

  • the customer may claim for an additional child; if recovery is by withholding you should consider withholding any additional entitlement to recover the debt.
  • entitlement to Child Benefit may end, the Child Benefit Office will update the Child Benefit system and notify us of the change via the DM notification form; you should calculate what has been recovered, update IT systems and pursue the balance owed.

The Child Benefit Office should notify DM using the DM notification form when changes to entitlement affect the rate of recovery.

Government increase in the rate of benefit during a period of withholding

If the Government announces an increase in the rate of Child Benefit during a period of recovery, the Child Benefit system should automatically update the account. However, when actioning a case you should always check recovery, update the award and amend recovery where necessary.