How to find out if your Carer's Allowance overpayment debt could be cancelled
Key points
- If you owe DWP money for a Carer's Allowance overpayment before September 2025, your debt may be reduced, cancelled, or you could get a refund.
- You do not need to do anything — DWP will write to you as part of a review of more than 200,000 cases.
- If you still get Carer's Allowance now, the usual rules apply — report any earnings over £204 a week to DWP straight away to avoid a new overpayment.
If DWP has told you that you owe money because of a Carer's Allowance overpayment, there is news that could help you.
The government has launched a major review of Carer's Allowance overpayment cases. DWP will look at more than 200,000 cases in total. Around 25,000 carers could see their debts reduced, cancelled entirely, or get back money they have already repaid.
Why did these overpayments happen?
Carer's Allowance has a strict earnings limit. In 2026 to 2027, you can earn up to £204 a week net and still get the full £86.45 a week payment. But if you earn even one penny more, you lose the whole weekly amount — not just part of it.
The problem was with DWP's guidance on earnings that go up and down from week to week. The guidance on how to average those out was unclear. It did not match what the law actually said. Many carers did not realise they had gone over the limit. DWP then sent them overpayment demands — sometimes for thousands of pounds.
An independent review led by Liz Sayce found the guidance was confusing. The government accepted 38 of the 40 recommendations from that review. One outcome is this large-scale reassessment.
Could your debt be cancelled?
DWP is checking overpayments that happened between 10 April 2015 and 2 September 2025. If your overpayment was caused by the unclear guidance on how to average out your earnings, DWP may:
- reduce the amount you owe
- cancel the debt entirely
- refund money you have already paid back
What do you need to do right now?
Nothing. You do not need to contact the Carer's Allowance Unit. DWP will write to you with a decision. They will get in touch if they need any more information from you.
If DWP is already taking money from your payments to repay an overpayment, keep up with those payments as normal until you get a letter telling you the position has changed.
Search for your next property on DSSmove →If you still get Carer's Allowance today
This reassessment is about past overpayments only. The usual rules still apply today. You must tell DWP as soon as your net earnings go over £204 a week. Reporting changes quickly is the best way to avoid a new overpayment building up.
Get free help
If you get a letter about your Carer's Allowance and you are not sure what it means, Citizens Advice can help you for free. If money worries linked to a past overpayment have led to rent arrears or housing problems, Shelter gives free advice on those too.
Frequently asked questions
What should I do if I get a letter from DWP about my Carer's Allowance overpayment?
Read the letter carefully, then contact Citizens Advice free of charge — they can help you understand what it means and what your options are.
Does this reassessment apply to carers in Scotland, Wales, and Northern Ireland?
Yes — Carer's Allowance is a UK-wide DWP benefit, so the reassessment covers all four nations.
Official source: https://www.gov.uk/government/news/unpaid-carers-impacted-by-unclear-guidance-to-have-debts-cancelled