Inevitably when a tenant has claimed Housing Benefit, an overpayment may result due to a change in circumstances, and this overpayment can be either recovered from the claimant or from the person to whom payment was made. There are two main methods of recovery of overpayments:
1. Via deductions from a claimant’s ongoing Housing Benefit.
2. Via the issue of an invoice.
If the decision is made to recover from a tenant’s ongoing Benefit via a set weekly deduction and payment is made to the landlord, then this will obviously reduce the amount a landlord receives on a 4-weekly basis. Landlords are kept fully informed as to the amount of the deduction and when deductions would commence, but it is then the tenant’s responsibility to make up the shortfall in the rent.
If the decision is made to recover the overpayment from the landlord, then an invoice is issued. This will show the name and address of the tenant, the amount of the overpayment and the period to which it relates. A landlord does have the right to appeal against repayment of the amount outstanding, not the amount or the cause. Any appeal must be in writing, giving full reasons for the appeal and must be received within one month of the date of the original notification. If a landlord experiences difficulty in repaying an invoice, then it may be possible to negotiate repayment by instalments.
Any underpayments of housing benefit due will be used to offset (reduce) any outstanding overpayments that are owed.
If a landlord fails to repay an overpayment, then the council has powers to recover the amount from the Housing Benefit of any other tenants the landlord may have, and while this is done reluctantly, it is sometimes necessary. You should also be aware that if a tenant has an overpayment from a previous claim, then this would also be recovered from any new claim that the tenant makes.