Repay and manage benefit money you owe (2024)

FAQs

How do I pay back my benefit overpayment? ›

You can only be asked to pay the overpayment back if the benefits office can show that you misrepresented something or failed to disclose something which affected your award.

You will always have to repay overpayments under the Universal Credit system. It does not matter what caused the overpayment. You can still argue that there never was an overpayment. You can ask the Department for Work and Pensions (DWP) if they will let you not pay back the overpayment.

Money may be taken from your Universal Credit payments to pay back money that you owe, or if you have a Fraud Penalty or Sanction.

The DWP can agree to waiver (write off) the overpayment. However this will usually only be done in exceptional circ*mstances where recovery action will result in severe welfare issues for you or your family. The DWP will also look into the circ*mstances of the overpayment.

If you do not repay your overpayment on time, the money can be deducted from future unemployment, disability, or Paid Family Leave benefits. We can also: Withhold your federal and state income tax refunds. Withhold your state lottery winnings.

If you have lost all of your appeals or have decided not to appeal any further, you must pay the money back. You can tell SSA that you want to repay it in small amounts each month that you can afford. SSA can withhold all of your Social Security benefits to repay the overpayment.

The Social Security Administration (SSA) recently removed a bar on recovery of old overpayments ten years or older.

If you believe that you may have been overpaid, but feel that it was not your fault and you cannot afford to pay us back, you may ask for: A waiver of the overpayment. And complete form SSA 632 (Request for Waiver of Overpayment Recovery).

There are no penalties if you've accidentally paid more than you owe, and there are laws in place that require issuers to refund your overpayment.

What happens when you report a benefit cheat? ›

Action can include removing a person's benefits and taking them to court. Sometimes no action is taken. The person may have declared a change in their circ*mstances or their benefit may not be affected by what you report.

Below are a few example situations that might lead to you facing an investigation: Living with a person who is contributing to your household income, and then not declaring that additional contribution when applying for benefits. Faking your accounts to make it appear that you have less money than you actually have.

After you get the letter, the Department for Work and Pensions ( DWP ) will reduce your Universal Credit payments until you pay back the money you owe. You do not have to do anything to set this up. There's a different process if you're in Northern Ireland. You will repay the Department for Communities (DfC).

Deductions from Universal Credit

If you are receiving Universal Credit and have no earned income, the maximum amount that can be deducted from your Universal Credit for overpayments is 15% of your standard allowance.

A fixed amount is deducted from your benefits until you've paid off the debt you owe. Money can be deducted to pay off up to 3 debts at once. If you receive Universal Credit, 5% will be deducted from your benefit payment for each debt you owe. For rent, between 10 and 20% will be deducted.

To get a refund for the excess withholding, fill out IRS Form 843: Claim for Refund and Request for Abatement according to the Form 843 Instructions and mail it in separately. Make a copy to keep with your tax return paperwork.