Tax credits overpayments

How to repay your tax credits

The Tax Credit Office will write to tell you what you owe and how to repay.

How you repay depends on whether you still get tax credits, Universal Credit or neither.

Call the helpline if you:

  • think the Tax Credit Office made a mistake
  • already have a repayment plan but you get another letter - you may need to set up a new plan

If you still get tax credits

HMRC will automatically reduce your future tax credit payments until you’ve paid back the money you owe.

The amount they’ll reduce your tax credit payments by usually depends on how much you currently get and your household income.

Household income Reduction
£20,000 or less and you get maximum tax credits 10%
£20,000 or less and you get less than the maximum tax credits 25%
More than £20,000 50%

If you only get the family element of Child Tax Credit, your payments will be reduced by 100% whatever your income is.

If you’ve moved to Universal Credit

Your future payments will be reduced until you’ve paid back the money you owe.

If you do not get tax credits or Universal Credit

HMRC will send you a ‘notice to pay’ which you should pay within 30 days.

It’s your responsibility to make sure payments reach HMRC on time. Check your bank’s transaction limits and processing times.

If you do not pay in time, HMRC can take action to recover the money you owe.

Call the helpline if you want to make extra payments to clear the debt more quickly.

There are several ways to repay.

Direct Debit

You can call the helpline to set up a Direct Debit.

You’ll need your tax credit reference number - you’ll find it on your notice to pay.

It takes up to 5 working days to set up. Payments appear on your statements as ‘HMRC NDDS’.

Online and telephone banking (Faster Payments)

Pay to HMRC’s account and use your tax credit reference number (found on your notice to pay) as the payment reference.

Sort code Account number Account name
08 32 10 12001039 HMRC Cumbernauld

Payments made by Faster Payments will usually reach HMRC on the same or next day, including weekends and bank holidays.

If you’re paying from an overseas account, you can pay HMRC in sterling or another currency.

Account number (IBAN) Bank identifier code (BIC) Account name
GB62BARC20114770297690 BARCGB22 HMRC Cumbernauld

HMRC’s bank address is:

Barclays Bank PLC
1 Churchill Place
London
United Kingdom
E14 5HP

At your bank or building society

Pay at your branch by cash or cheque along with the HMRC payslip included with your notice to pay.

Make cheques payable to ‘HM Revenue and Customs only’ followed by your tax credit reference number (found on your notice to pay).

HMRC will accept your payment on the date you make it and not the date it reaches HMRC’s account.

By cheque through the post

You can pay by cheque made payable to ‘HM Revenue and Customs only’ followed by your tax credit reference (found on your notice to pay). Also include the payslip HMRC sent to you.

Allow 3 working days for payments to reach HMRC.

HMRC
Direct
BX5 5BD

Do not fold your payslip or cheque or fasten them together. If you want a receipt, include a note asking for one.

If you do not have a payslip

Include a note with:

  • your name, address and contact phone numbers
  • your tax credit reference number (found on your notice to pay)
  • how much you’re paying
  • period you’re paying for