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Housing benefit overpayments

What is an overpayment?

An overpayment is an amount of benefit that we have paid to someone when they are not entitled to it, under the rules. It can happen for both Housing Benefit and Council Tax Reduction.

Why do overpayments happen?

We may have to work out your benefit amount again because you have had a change in your circumstances or we have found a mistake. If your benefit goes down and we have already paid you a higher amount there will be an overpayment.

Some examples of why an overpayment could have happened are:

  • you may have forgotten to tell us that your income has increased, for example, you have had a pay rise, or your earnings, tax credits or pension have increased
  • somebody may have moved into or out of your home and you have not told us
  • if you have other adults living with you and their circumstances have changed and you have not told us
  • you have moved out of your home and not told us
  • you may or a member of your household may have started work or changed jobs
  • there may have been a short delay between you telling us about a change and us changing your benefit award
  • we may have made a mistake and put it right it later
  • we may have made a mistake
  • you may have given us wrong information
  • you may have been slow to tell us about a change

You must tell us about any changes immediately and not rely on anyone else to do it for you. Even if you have told the Department for Work and Pensions (DWP), Jobcentre or your landlord about your change in circumstances, you must still tell us because we deal with Housing Benefit and Council Tax Reduction.

What happens when we find an overpayment has been made?

We will do the following:

  • identify the period, amount, and cause of the overpayment
  • decide if the overpayment is legally recoverable
  • decide whether to recover the overpayment
  • decide who to recover the overpayment from
  • we will write to you with the details

Will you expect me to pay the money back?

  • Yes, if it was your fault that we overpaid you, for example you did not tell us about an increase in your income
  • Yes, if it was not our fault. For example, you got a backdated pay rise and you could not have told us about it any earlier or perhaps you got a pay rise in June that was backdated to April. We would work out your benefit again from April using the higher wage which could create an overpayment 2 of 3
  • Yes, even if it was our fault, if you could have realised we were overpaying you. For example, if you get a pay rise you should expect your benefit to go down. If your benefit hasn't changed you should realise that something is wrong and let us know
  • No, if it's not our fault and you could not have realised you were getting too much benefit

How do we get the money back?

By Housing Benefit instalments

  • If we are still paying you Housing Benefit we can take money out of each week's benefit to take back what we have overpaid you
  • If we pay you a single payment of arrears of Housing Benefit we can take the overpayment from it

Remember, if the benefit we pay towards your rent is reduced you will have to pay the amount of money we take to your landlord from your wages or other benefits.

We can discuss the rate we will recover the overpayment with you to avoid you any hardship.

From your council rent account

For council tenants, if your rent account is in credit because you have overpaid we take this credit off the account to clear the overpayment. We will not put your account into arrears by taking more than the credit so that you owe more rent.

From your landlord

If we have been paying your benefit to a private landlord, housing association or housing trust, we may ask them to repay the money if they could have been expected to know they were being overpaid, for example, if you have moved.

By sending you an invoice

We may send you an invoice asking you to repay the money and this should be paid by the due date. You can pay the bill online, by telephone, post or in person. The invoice gives full details of payment methods available.

If you cannot pay the invoice in full, you should contact us to agree a special arrangement to pay the invoice in installments.

In some cases we can negotiate a realistic level of repayment over a longer period of time, by smaller regular payments. In these cases you will be expected to complete a statement of your financial affairs for an offer to be considered. However, this does not mean that any offer is guaranteed to be accepted.

If you do not pay the invoice and you do not contact us to make an acceptable offer of repayment, we can then seek to recover the overpayment through the County Court that can result in you incurring extra costs, and in a judgement being entered against you. This may prevent you from obtaining a mortgage, credit or hire purchase facilities.

Other methods of recovery can include attachment to earnings, bailiffs or a charging order.

Council Tax Bill

If we overpaid you Council Tax Reduction, we will add the amount of the overpayment to your Council Tax bill and increase your installments. If you do not pay the increased installments we may get a court order which will incur extra costs for you. If you have a problem paying your Council Tax bill please get in touch with us as soon as possible.

Other ways we can get the money back

  • we can ask the DWP to take money out of your benefits
  • we can ask another council to take money out of any Housing Benefit they are paying you

How do we tell you about the overpayment?

We will tell you about the overpayment and the action we will take to recover it by writing to you. It will explain what the overpayment is for, and show the dates for which you have been overpaid. If you disagree with the overpayment you can:

  • email , phone or visit us at Greyfriars House to ask for an explanation
  • write to us within one calendar month of the date of the letter to ask us to review the decision

Reducing overpayments

In some circumstances we can reduce the amount you have been overpaid if you tell us about your correct circumstances during the period of the overpayment. If we do this it is called underlying entitlement.

If you have an underlying entitlement, which means you could have received some benefit but not all that we paid, we can use this to reduce the overpayment.

If you have already paid the overpayment back to us, we will pay you the Housing Benefit that we now owe you.

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