The tax returns of Australians appealing controversial "robodebts" have been seized by the Department of Human Services, in what may be a breach of its own policy.

Key points: Some people are finding their tax returns have been garnished over alleged robodebts

Some people are finding their tax returns have been garnished over alleged robodebts Miranda Debeljakovic is disputing her robodebt but still had it taken from her tax return

Miranda Debeljakovic is disputing her robodebt but still had it taken from her tax return The Department of Human Services says it garnishes tax returns in accordance with the law

Automated debts raised by Centrelink have been criticised by legal groups because they put the onus on welfare recipients to prove they do not owe any money.

The controversial scheme matches income data from the Australian Tax Office with income reported to Centrelink by welfare recipients.

Compliance officers from the Department of Human Services told 7.30 they are experiencing a large volume of calls from Australians who have unexpectedly had their tax returns garnished over alleged robodebts.

In some cases, disputed debts have been taken directly from people's tax returns.

Miranda Debeljakovic says she now has to prove she does not owe the money that has already been taken off her. ( ABC News: Jerry Rickard )

Miranda Debeljakovic is one of those people.

Last year, she received an $8,920 debt notice from Centrelink. The debt was later found to be inaccurate and was reduced twice — first to just $2,797, and later to $2,117.

"Every single day I was waking up and I was thinking about the debt and what I was going to do about the debt," Ms Debeljakovic said.

When she got her tax return, the $2,117 had been deducted.

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A policy guide for compliance staff seen by 7.30 states that debt recipients who have lodged reviews are exempt from the garnishing process.

"I think the fault with this entire system is that … the onus is on the individual to prove that they don't owe a debt," Ms Debeljakovic said.

"And now that my money has been taken away from me, I also have to prove that I don't owe the money that's already been taken off me."

A spokesman for the Department of Human Services told 7.30 it would not comment on individual cases, but that it garnished tax returns in accordance with the law.

"We only take this action when other attempts to recover money owed have failed. In these cases, we notify the person before any action occurs," he said.



Centrelink 'double-dipped' into aged pensioner's benefits



Pamela Egan was told she owed a $9,305 debt. It was later reduced. ( ABC News: Alex McDonald )

There are growing concerns about the use of automated debt recovery against vulnerable Australians, including disability support pensioners and aged pension recipients.

The Department of Human Services told 7.30 in July that a "small number" of pensioners were targeted in online compliance reviews.

Sydney aged pensioner Pamela Egan, 72, was told she owed a $9,305 debt in 2016.

"They're not interested in the average person," she told 7.30.

"They're only interested in getting money and they don't care who they get it from and how they get it, and what we have to do without to pay it."

The Department of Human Services regularly deducted funds from her pension each fortnight to repay her debt.

"My sister passed away in December, and having the debt on top of all this was just, I was stressed out because of it, I was worried about it," she said.

"I didn't know what I was going to do."

7.30 first contacted the Department of Human Services about Ms Egan's case in July. Several weeks later, her debt was reviewed by a compliance officer and reduced to just $4,209. She was refunded the excess amount of $152.19.

Ms Egan says a department officer told her on the phone it was due to a mistake in which part of her income was counted twice. Her Centrelink records appear to back this assessment.

One of her employer's names appears twice on an internal working document, which 7.30 has been told is a common error in the data-matching process.

"My anger is that they had a $9,000 debt that suddenly came down to $4,000," she said. "I told them the truth but they still managed to double dip.

"So I'm questioning their accounting procedures and how they came up with that figure in the first place."

She says she maintains that even the reduced debt is incorrect.

Stuart Robert apologised to disability pensioner's mother

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Watch Duration: 1 minute 22 seconds 1 m 22 s Stuart Robert apologises to Anastasia McCardel in Parliament on July 30, 2019. Ms McCardel received a robodebt for her son six months after he died.

A spokesman for the Department of Human Services told 7.30 that since it started, the scope of the online compliance program has not expanded to include new payment types.

7.30 previously revealed that the department had attempted to recover a debt from a deceased disability pensioner, placing the robodebt scheme under significant public scrutiny.

Minister for Government Services Stuart Robert apologised to the pensioner's mother in Parliament

"In the vast majority of times, compassion will step in and the debt will be wiped," Mr Robert said. "In this particular case, because of the size of the debt being both uneconomical to recover as well as the length of time, the department should have simply waived the debt.

"They didn't, my department was wrong, I apologise for it."

The debt recovery program is now facing two separate parliamentary inquiries.

A spokesman for the Minister for Government Services referred to the department's response.

