Write off action defers recovery of an overpayment without affecting the right to recover at a later date. However, write off action should only be taken if all appropriate recovery action has been attempted and recovery is not possible.
Where write off action is taken, a debt may be written off for the duration a debtor cannot repay. The written off debt may be reinstated at any time during that period, if a change in the debtor's circumstances permit recovery of whole or part of the debt.
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Example |
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An employee is currently repaying a number of other debts and is not in a financial position to also repay his overpayment. The overpayment is written off for a year, until the employee has completed repayment of other debts. |
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Two debt collection services reduce the amount of repayments by $200 and $100 respectively, so the employee is able to finalise payment of those debts sooner than expected. The employee is now in a position to commence repayment of the overpayment two months earlier, so the debt is reinstated in October, rather than December. |