CCM8127 - Closing the Examination: In-Year Recoveries - Interest

Where an overpayment arises as a result of fraud or neglect and it is recoverable in-year, interest will be charged if it is not repaid within 30 days of the date of the revised award notice.

In most cases if there is fraud or neglect you will be charging a penalty so you will be seeking a letter of offer to include the overpayment, the interest and the penalty - see CCM8230. However, in some cases there will be fraud or neglect but you will not be settling by a letter of offer. This could be because:

• there is no penalty – See CCM10070 or
• the claimant will not make an offer

You can only treat the overpayment as attracting interest where you have established fraud or neglect. The decision to charge interest carries a right of appeal so if you have decided an overpayment will carry interest, you must be able to defend your decision on appeal if necessary. Where you intend to charge interest this must be included in your closure letter – see CCM8150 and you will then need to notify the interest charge to the SAFE Unit, Tax Credits Team, Shipley using the stencil below.

[ Interest stencil]

Where your Claimant Compliance Group Manager (CCGM) has agreed to waive the penalty because the claimant’s means are inadequate ( CCM8460) you should not charge interest. In these cases the interest stencil should not be completed.

Where exceptionally there is no penalty ( CCM10070) but you have established fraud or neglect and your CCGM agrees the claimant’s means are inadequate you should not charge interest. In these cases the interest stencil should not be completed.