What happens if you've overpaid a Centrelink debt

Sometimes you may accidentally pay more towards a Centrelink debt than you need to.

When this happens, we’ll either refund the money to you or apply it to another debt if you have one.

We’ll ask you which option you prefer.

There are a few ways you can overpay a debt with us. The most common ways are:

• not cancelling your automatic debt repayments
• a reduction of the amount owing after a formal review of the debt
• you have a Family Tax Benefit Non-Lodger debt, but you’ve now confirmed your actual income for the financial year.

If we contact you about a refund

From late October 2025, we started contacting some people who’ve overpaid their debt and did not have their refunds processed properly. This was due to an error we made.

We’ve taken steps to prevent this issue from happening again. We apologise for any inconvenience we’ve caused.

We’ll call or write to you to give you details of your refund and discuss next steps. We may need to confirm your bank details as part of this process.

If you’re affected, we won’t use these refunds to repay other Centrelink debts, unless you ask us to do so.

We won’t include interest as part of the refund to you. If you have evidence our error has caused you financial loss, we can support you to make a claim for compensation through the Compensation for Detriment caused by Defective Administration (CDDA) scheme.

We’ll assess CDDA claims on a case-by-case basis.

If we’ve called or written to you about this and you want to discuss it further, you can call us on the Debt Remediation line.