private pension overpayment – net or gross in HB/CTB calculation?

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  • #38811
    irenejoy
    Participant

    We have a clmt who has a LGPS and he has been advised he has been overpaid from 29.08.08 to the tune of £4216.24.

    Clmt is not pension age.

    He has been advised his future payments will have a £50.00 per month deduction until the overpaid pension is recovered.
    clmt believes we should use the lower amount.

    I believe we should use the gross pension he should be getting and not the net after deduction. Am i correct?

    We are having a debate and i know that it seems unfair but can’t shake my belief.
    (we were using the higher figure he was receivng before it was discovered he was getting too much)

    Any pointing to relevant regs would be gratefully received.

    #109799
    chris harvey
    Participant

    For occupational pensions you deduct any income tax so it’s the net value after tax that you use. The deduction for income tax is in Schedule 5 (HB) or Schedule 4 (CTB)

    #109800
    chris harvey
    Participant

    End of the day and not reading your post properly. I think if he has the pension reduced by the pension provider to recover an overpayment you may have to take the gross value. I think it’s his entitlement not the payment you have to use. I thought there was some caselaw supporting this but I can’t put my finger on it. The GM talks about using the gross value of social security benefit income so I can’t see why an occupational pension should be different.

    #109802
    Kevin D
    Participant

    In my view, it must be the gross amount. Like Chris, I’m pretty sure that a deduction for repaying an overpayment, in this context, is irrelevant (I also concur there is case law but, annoyingly, I also can’t immediately identify it). Further, the clmt has already received the gross amount by way of the overpayment – he’s had the advance use of it. Now, he’s simply paying back what was over and above; he’s not actually losing the amount of the deduction (he’s already got it).

    #109803
    John Boxall
    Participant

    Reg 59(7) of the HB (SPC) Regs states

    7) Without prejudice to paragraph (6), where the change of circumstances is the payment of income, or arrears of income, in respect of a past period, the change of circumstances shall take effect from the first day on which such income, had it been timeously paid in that period at intervals appropriate to that income, would have fallen to be taken into account for the purposes of these Regulations.

    So as far as I can see you have to reasess the period when he had been overpaid as if he had been paid correctly, and ignore the deduction on the current entitlement

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and—and in short you are for ever floored.

    Wilkins Micawber, Ch12 David Copperfield

    #109805
    irenejoy
    Participant

    thank you all very much – had also thought that there was some caselaw about this but could not find on a search.

    I was confused as on the one hand we use gross amount when there are deductions for o/p’s from incap etc but use net figure for tax credits when there has been o/p’s.

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