Death Of A Claimant - Overpayment Involved (Info)

At the end of each tax year the computer looks at every award and decides if there is an overpayment. If there is a

• Continuing award, the overpayment will be recovered from the claimant's new award at a rate of 10%, 25% or 100%. This is called cross year recovery

• No continuing award, the recovery method will be direct. This means that 30 days after the Finalised Award Notice has been issued, a form TC610 Notice to Pay (with a payslip) will be issued to the claimant for them to use to make the repayment within 30 days. Once 30 days have passed, if the overpayment has not been repaid the computer will forward the details to Receivables Management Service (RMS) who will then deal with all recovery action for that overpayment

If at any time we receive notification of the death of a claimant(s), the tax credits award is ended and recorded as a household breakdown.

Function REVIEW HOUSEHOLD ACCOUNT will then run and decide if the ended award was balanced, overpaid or underpaid.

If the award has been underpaid, any outstanding payment of tax credits will be made automatically by the computer to the estate of the deceased.

If the award has been overpaid, the computer will forward the details of the overpayment automatically to RMS. They will deal with any recovery that needs to take place.

If notification has been received about the death of one claimant in a two-claimant household, RMS will seek to recover the overpayment from the surviving partner. This is because both claimants are jointly and severally liable for the overpayment

If notification has been received about the death of both claimants in a two-claimant household or the only claimant in a one-claimant household, RMS will seek to recover the overpayment from the estate of the deceased. If this is not possible, the overpayment may be remitted to balance the claim. RMS will deal directly with the executor.

If recovery action is already taking place on an overpayment when notification is received of the death of one or both of the claimants, then if the overpayment is in

• Cross year recovery, this will be stopped and the remaining overpayment amount will be immediately forwarded to RMS

• Direct recovery but has not yet been forwarded to RMS, then no matter what stage in the cycle the recovery is at, the details will be forwarded to RMS

• Direct recovery and has been forwarded to RMS, the computer will send an update to RMS informing them of the notification of death