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Benefits Overpayment - Housing Benefit Overpayments

Guide to Benefits Overpayments, what they are, why they happen and what you should do if you have been overpaid

Last reviewed 08 December 2023

Housing Benefit Overpayments

Most overpayments of Housing Benefit (HB) are recoverable.

However, they are not recoverable if:

  • It was caused by ‘official error’ (this means an error by the local authority, the Department for Work and Pensions (DWP) or HM Revenue and Customs (HMRC)), and

  • You did not contribute to the error, and

  • You could not reasonably have been expected to know that you were being overpaid.

Overpayments may be recovered from the person who received the overpayment or a person who caused the overpayment.

If the overpayment was paid to your landlord, seek advice from a benefits adviser if the local authority try to recover this from you as this may not be correct.

How are Housing Benefit overpayments recovered?

An overpayment of Housing Benefit (HB) may be recovered by:

  • Deduction from your on-going benefit, which is the usual HB overpayment recovery method. If the overpayment was made while you were a member of a couple, the overpayment may be recovered from benefit paid to you or your partner so long as you remain a couple

  • Adjustment of your rent account if you are a local authority tenant (HB)

  • Deduction from other benefits: if you are no longer receiving HB, the local authority may ask other benefits offices, such as the Department for Work and Pensions (DWP), to recover by deduction from other benefits. However, only if the overpayment was due to your misrepresentation or failure to disclose

  • Direct recovery from you if the local authority is not able to recover the overpayment from on-going benefits. In this case, the local authority would write to you asking you to repay or contact them to arrange repayment

  • Court action: this must normally begin within six years of the decision that the overpayment is recoverable. Get advice if you are in this situation

  • The local authority does not have to recover in every case and may agree to reduce or write off the overpayment in exceptional circumstances.

Civil Penalties

The local authority has the same power to impose a civil penalty as the DWP. If the local authority decides that an overpayment should be recoverable, they will also need to decide whether the overpayment resulted from your negligence in providing incorrect information and whether you have a reasonable excuse for your failure to provide correct information. 

How do I challenge a Housing Benefit overpayment decision?

If you do not agree that you have been overpaid, or do not think that this is recoverable from you, you can ask for this to be looked at again and appeal against the decision. See our Challenging Decisions information.

If the overpayment is recoverable from you, there is no right of appeal against the local authority’s discretion to recover. However, you can make a complaint if their decision is not reasonable.

Avoiding overpayments of Housing Benefit

  • Every time you move home, write to your local authority benefit section to let them know. If you move to a different local authority area, you will also need to make a new claim with the new authority. Unless you (and your partner if you live together) are over pension age, you won't be able to make a new claims for Housing Benefit and would need to get help with housing costs from Universal Credit.

  • Report any changes to your household or who lives with you.

  • Let your local authority benefit department know if you stop receiving Income Support, income-based Jobseeker's Allowance (JSA), income-related Employment and Support Allowance (ESA) or Pension Credit Guarantee Credit. You will need to give details of your new income and capital

  • Be careful to report increases in earnings, other income or capital.

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