Advice request - Salary Overpayment

[Losa123]

Hi
Was t sure which forum this query was best placed to be but wonder if anyone had any pointers on what I should do ...will keep it as brief as possible...
I was overpaid by an ex employer I agreed to repay and arranged to pay via a payment plan. I was refused my p45 and the p60 included the overpayment. HMRC reduced my taxable allowance stating I have underpaid tax and tax credits have ceased due to the salary they reported. HMRC are refusing my appeals and advising the ex employer needs to submit a rectification but they refuse to do this until full repayment.* * * * * * * * * * * * * * * * * * I never missed a payment then out of the blue got a demand for the full balance. Replied to advise I was not in the financial position to do this (I continued paying my agreed payment plan throughout). I then got a pre court action letter from a debt collection agency. I provided the information as requested (and continued paying).*
Now have received an email to say they are not perusing the matter further and will submit an RTI to HMRC*
Does this mean that a debt is written off and deducted from my salary payment for that employment or will it still be treated as income. Not sure what to do to rectify the salary reported for that year so my tax can be sorted ...anyone have any advice on what I should do next? (or if further info needed do let me know)*

[ULA]

Who did you receive the email from your ex-employer or the debt collection agency?

Is there still a balance outstanding of what you have paid back compared to what the overpayment amount was?

[Losa123]

So the payment plan was agreed with the ex employer.
For a bot of background they decided to transfer my account to a debt collection agency after seeing on LinkedIn I had been with a new employer for 3 years (they never contacted me to verify this information as it was in fact a series of short term contracts so my financial position didn't change).
So I randomly got a pre court action letter from the debt agency. After lots of coresspondance querying the course of action I completed the form. The ex employer then emailed me to say they were no longer praying and to stop payments which I was still making. My concern is my HMRC tax position is the debt wiped off or is it still classed as income as there is a remaining balance. I never heard from the debt agency again

[Losa123]

Excuse the typos!!

[ULA]

Although they are not pursuing the debt is there still a balance "owing" on the overpaid salary? If so and they are not requesting this to be paid then I believe that this will be considered as income.*