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From 1 October 2012, the Department for Work and Pensions (DWP)
and local councils have the power to impose a fixed
rate civil penalty on some claimants who have been overpaid a
social security benefit.
The penalty will be £50. It will be added to the total amount of
the overpayment and will be recovered by the same method.
Different rules apply to overpayments of tax credits.
For a civil penalty to apply the overpayment must:
The overpayment of benefit must have been caused by a
A fixed penalty will not be applied if the DWP or local
authority decides to take action under benefit fraud provisions.
Possible actions under these rules can include:
For each overpayment, only one civil penalty can be applied.
DWP decision makers have issued guidance on how to decide when
it may be appropriate to impose a civil penalty. This gives
examples of the sorts of factors a DWP decision maker should
consider when deciding whether to impose a civil penalty.
The decision to impose a civil penalty will be made at the same
as the overpayment decision. When the DWP realise you may have been
overpaid benefit, they will look again at your award and make a
decision with the corrected award of benefit for the period that
the overpayment applies. At the same time they will decide whether
the overpayment should be recoverable from you. Only if the
overpayment is recoverable will they go on to consider whether a
civil penalty should be applied.
You will get a decision letter that states:
If you disagree with any [or all] of these aspects of the
decision you can appeal. If you appeal against the decision to
apply a civil penalty you will not to show that your actions were
reasonable in your specific circumstances.
Where benefit is paid jointly to a couple, a civil penalty can
be imposed on either partner or on both partners jointly. However
only one penalty can be imposed for each overpayment.
If one partner was unaware, and could not reasonably be expected
to be aware, that their partner had made a negligently incorrect
statement, then no penalty can be applied to that person, but a
penalty may be applied to their partner.
A civil penalty can be imposed on any person who has made a
negligently incorrect statement in connection with a claim for
benefit. If you have helped another person make a claim, or if you
are an appointee for them, it is possible that you may be
responsible for the civil penalty, even if the actual overpayment
of benefit is the responsibility of the benefit claimant
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