HMRC extend time limit for restoring claims for those who missed the renewal deadline
6 August 2012 | by LITRG
This week, HMRC will be stopping the provisional payments of claimants who failed to renew their claim by the 31 July deadline.Failure to renew means that there is no new claim for 2012/13, consequently any provisional payments made to a claimant from April 2012 will become overpaid.
The amount of this overpayment will be notified to claimants on a TC607 Statement of Account (SOA), issued when the provisional payments are stopped. HMRC will then seek recovery of that overpayment, plus any older overpayments, by direct recovery.
So what can you do if your client has missed the deadline? Well, fortunately if swift action is taken, all is not lost. Firstly, tax credits regulations allow the claim to be restored providing the claimant renews within 30 days of the date on the statement of account. In addition, for the third year running, HMRC have confirmed that they will be extending the legislative 30 days to 62 days.
Outside of this 30/62 day time limit, the claim can only be restored if there was ‘good cause’ for missing the deadline and renewal is completed by 31 January 2013. According to HMRC, good cause could include the claimant not being able to complete the form earlier due to exceptional circumstances or the claimant not being able to make arrangements for someone to handle their affairs. Under the current HMRC guidance, each case is to be reviewed on its merits.
If the claim cannot be restored (because there was no good cause or if good cause was present the renewal was not done before the 31 January), all provisional payments paid from 6 April 2012 will be treated as overpaid, and the claimant will have to make a fresh claim which can only be backdated a maximum of 31 days.
You can read more about the renewals process including details of how to withdraw from the system and how the process works in the tax credits guidance section of Revenuebenefits. HMRC also publish a helpsheet for advisers about the renewals process.
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