Housing Benefit and Council Tax Reduction overpayments are caused when you have a change in your circumstance that means you will get less money and there is delay in applying the change to your claim. The following page contains information about how overpayments are caused and what action you need to take if you are overpaid.

Overpayments - general information

If there is a change in your circumstances you may be overpaid Housing Benefit or Council Tax Reduction.

What is an overpayment?

We may have had to recalculate your benefit if there has been a change in circumstances or a mistake. Any change in circumstances may reduce your benefit entitlement, for example:

  • An increase in your income
  • A change in your household
  • You moving out of a property

An overpayment will usually occur if there has been a delay between the date of the change and the date it has been reported to us.

Preventing an overpayment

Make sure that you give us correct information so that we get your benefit right first time. You must tell us about changes to your circumstances straight away because it takes us time to deal with them. If we make a mistake or there is a delay in processing it may cause an overpayment. If you get Council Tax Support we work it out for the whole year at the beginning of April, so if something changes during the year it may mean we've paid too much and need to adjust your bill.

Housing Benefit overpayment following a Universal Credit claim

If you begin to get Universal Credit, your Housing Benefit will be cancelled from the day your Universal Credit award starts. Any Housing Benefit you have received past the date Universal Credit starts will be treated as an overpayment.

The overpayment will be recovered through your Universal Credit entitlement. If you have a query about the amount being recovered you will need to contact Universal Credit directly.

When we can / cannot ask you to pay the money back

We can ask you to pay it back:

  • If it was your fault we overpaid you, for example, because you didn't tell us about a change 
  • If it was not really anyone’s fault, for example, because you got a pay rise in June, backdated to April that you could not have told us about earlier
  • If it was our fault; you realise we are overpaying but you don't tell us. For example, if you get a pay rise but your benefit and Council Tax Support does not change, you should realise something is wrong and let us know.

We can recover the overpayment from:

  • You, and in some cases, your partner
  • An appointee acting on your behalf
  • The person who the benefit was paid to (including your landlord or their agent)

In some cases we may decide that it's unreasonable to ask you to pay back an overpayment.

We can't ask you to pay it back:

  • If it's our fault and you couldn't have realised you were getting too much Housing Benefit or Council Tax Support
  • If we have been paying your landlord we may get the money back from them, but if we decide the overpayment was your fault and your landlord couldn't have known you were being overpaid, we expect you to repay the money.

In all cases we will write and tell you our decision. You have a right of appeal if you do not agree.

Ways of paying the money back

There are different methods we can use to recover the overpayment:

  • Deduction from on-going Housing Benefit entitlement by a set amount each week depending on the level of your income. You will need to pay an extra amount to your landlord/rent account to make up the shortfall in benefit 
  • Reducing Housing Benefit entitlement paid to a landlord or agent on your behalf. Again, you will need to pay an extra amount to your landlord to make up the shortfall in benefit
  • Issuing an invoice if you no longer qualify for Housing Benefit, an arrangement can then be made to repay the debt in instalments
  • Deduction from certain welfare benefits
  • Recovery from a deceased person’s estate
  • If you have an overpayment of Council Tax Reduction this will be added to your Council Tax account and a new Council Tax bill will be issued with revised instalments
  • If you have been overpaid Housing Benefit/Council Tax Reduction there are some circumstances in which this could be reduced by re- calculating your benefit based on your new circumstances. Any underpayment is used to reduce the overpayment only- this is known as underlying entitlement
  • We can ask another council to make deductions from benefits they are paying to you
  • If you are a council tenant, any overpayment may be reduced by any credit on your rent account

Even if the overpayment wasn’t your fault you may still be required to repay it, but only if it is considered reasonable that you would have been aware that you were being overpaid.

Please note: the same rules do not apply for Council Tax Reduction; overpaid Council Tax Reduction will be added to your Council Tax account regardless of the circumstances of the overpayment.

Further information