An overpayment is an amount of Housing Benefit (HB) and Council Tax Benefit (CTB) that has been paid, but there was no entitlement under the Regulations. It also includes overpaid Council Tax Support (CTS)

Overpayments may happen if you do not report a change in circumstances. This usually means that overpayments must be paid back. More seriously, failure to declare a change of circumstance is potentially a criminal offence that may result in legal action being taken against a claimant. This can include prosecution

Recovery of overpayments

An overpayment is recoverable from either the person who caused the overpayment, or the person who received the overpayment.

Overpayments of CTB and CTS cannot be recovered from ongoing HB payments and overpayments of HB cannot be recovered from CTB or CTS payments.

Overpayment of CTB (excess benefit) or CTS

Where CTB or CTS has been overpaid, this is known as excess benefit. The overpayment will be added to the council tax bill and will need to be paid in addition to the annual council tax due.

Overpayment of Discretionary Housing Payment (DHP)

Where DHP has been overpaid we would normally send an invoice for payment.

Overpayment of HB

Where HB has been overpaid, we will recover this using a variety of methods outlined below:

Recover from the claimant

If the claimant is currently receiving housing benefit, the overpayment will be recovered from future benefit payments by a weekly deduction. This is known as recovery from ongoing benefit or 'claw-back'.

If payments are made direct to the landlord, we will reduce the amount of HB paid every 4 weeks by the amount we are clawing back to recover the overpayment.

The claimant is responsible for paying any rent arrears that occur as a result of the reduced amount paid to the landlord.

If the claimant is not currently receiving HB, the overpayment may be recovered from other benefits or an invoice for payment may be issued.

Recovery of an overpayment will not prejudice any criminal proceedings that may be taken by the Council in respect of fraudulent overpayments. In other words if we successfully prosecute a claimant for a fraudulent claim, they will still have to pay back the overpayment on top of any sentence or fine the court may give them.

Recover from the landlord

If a landlord received an overpayment of HB we can recover this from that landlord. We will usually take into account the reason for the overpayment and whether it is reasonable that the landlord could have known about the claimant's change in circumstances that caused the overpayment.

If a landlord fails to repay a HB overpayment or is unsuccessful at an appeal and the sum remains unpaid we can decide to recover the debt from HB paid to the landlord for other tenants. Landlords cannot attribute the amount deducted to the tenant that the HB is being paid for - these are known as "blameless tenants".

If a landlord habitually fails to repay overpayments that are recoverable from them, the Council can decide that the landlord is not a 'fit and proper person' under Benefit Regulations, and can refuse to make direct benefit payments to that landlord.

Recovery of an overpayment will not prejudice any criminal proceedings that may be taken by the Council in respect of fraudulent overpayments.

Appeal rights

The claimant can ask for a revision or appeal of a decision to calculate an overpayment. Any such request should be made within one month of the decision notice.

Landlords have the right of appeal against a decision to recover an overpayment from them but do not usually have the right of appeal against the reason for the overpayment.

Where the overpayment is owed by the landlord personally, they will be notified in writing of a decision to recover from them.

Any request for a revision should be made within one month of the decision notice.

A landlord can write to the Council at any time requesting a written statement of reasons for the recovery of an overpayment from him.

Important notes

A landlord can only request a review where recovery is being sought from them personally; that is, where an invoice for payment has been issued to them, or a deduction is being made from the benefit they receive for one of their tenants in order to recover an overpayment owed by the landlord.

For further information see Benefit appeals.

Overpayment that are not repaid?

Where an invoice addressed to a landlord remains unpaid, or an agreed arrangement to repay the debt over time is not being maintained, the Council may take action in the County Court.

See also

Related sites

Contact us

Merton Benefits Service
PO Box 610
Merton Civic Centre
London Road

Telephone: 020 8274 4903