CCM16800 - Enquiries: Penalty cases: Appeal against the interest charge

We can only charge interest where an overpayment arises as a result of fraudulent or negligent conduct by the claimant or someone acting on the claimant’s behalf. Your TCC52 letter includes your decision to charge interest and the letter tells the claimant they can appeal against the decision. There are four situations that you may encounter.

1. The claimant appeals against the decision to charge interest and against the revised decision - follow the guidance in CCM16710.
2. The claimant appeals against the decision to charge interest and has objected to the penalty - see CCM16780. If the claimant continues to disagree with your decision to charge interest see (c) below.
3. The claimant has only appealed against the interest charge - this would be an unusual situation and should be handled with care. Your first action must be to make your manager aware that an appeal has been received and then you must consider the grounds for the appeal.

• If the claimant is appealing on hardship grounds you and your manager will need to consider this carefully. If your manager accepts the payment of interest will cause hardship the charge can be waived, however, this will also mean that a penalty will not be charged. You will need to notify the SAFE Unit, Tax Credits Team, Shipley that the overpayment no longer attracts interest and close the case on TCW - see CCOM21075.
• If the claimant is appealing on the grounds there is no fraud or neglect you will need to consider what the claimant says and whether you now agree the incorrect claim or statement was a mistake or misunderstanding. If you agree there is no fraud or neglect there can be no penalty. You will need to notify the SAFE Unit, Tax Credits Team, Shipley that the overpayment no longer attracts interest and close the case on TCW - see CCOM21075.
• If the claimant is appealing on the grounds there is no fraud or neglect but you do not accept this you should seek advice from Compliance, Technical Team (B&C Del) before proceeding.

4. The claimant has appealed against the decision to charge interest and the formal penalty determination. In these situations the appeal against the interest is likely to be a late appeal because the decision to charge interest in contained in the TCC52 letter which is issued some time before the penalty determination. Your first action must be to make your manager aware that an appeal has been received and then you must consider the grounds for the appeal.

• If you and your manager agree that we should not charge interest or a penalty you will need to notify the SAFE Unit, Tax Credits Team, Shipley that the overpayment no longer attracts interest and amend the penalty determination to nil. Then close the case on TCW - see CCOM21075.
• If you and your manager still believe we should charge interest and a penalty you should seek advice from Compliance, Technical Team (B&C Del) before proceeding.