New amendments to tax credits regulations
Several changes to tax credits take effect, mostly from 6 April 2009. Three of the most important changes are described in more detail under the separate headings below. The amendments also clarify the following:
- Receipt of a social security benefit does not qualify as payment for work.
- A foster parent cannot claim the childcare element for looking after a child that they foster.
- Changes to the definition of eligible childcare in England
- The Health in Pregnancy Grant is not counted as income for tax credits purposes.
- CTC may still be payable if it was in payment for a qualifying young person with a partner before 1st September 2008. If the young person marries or moves in with their partner after this date, entitlement was removed by a previous amendment, unless the spouse or partner is also a qualifying young person.
View the amending regulations in full
Disability elements and backdating
From 6 April 2009, the following changes come into effect:
- The disabled child and severely disabled child elements of child tax credit (CTC) can be backdated for more than three months as long as the Revenue is notified within three months of the decision to award disability living allowance (DLA). It is no longer necessary to have first notified the Revenue when the claim for DLA was made.
- A new claim for WTC can be backdated for more than three months where the claimant would only have been entitled to WTC if a disability benefit was awarded. This allows WTC to be paid from an earlier date as long as the WTC claim is made within three months of the disability benefit decision. It is no longer necessary to have made a prior ‘failed’ claim for WTC while waiting for the disability benefit decision.
- The disability and severe disability elements of WTC can be backdated for more than three months as long as the Revenue is notified within three months of the award of a disability benefit. It is no longer necessary to have first notified the Revenue when the claim for a disability benefit was made.
Couples where one partner is subject to immigration control
The regulations also affect couples where one partner is subject to immigration control, meaning that he or she is not an EEA national and requires leave to enter or remain in the UK but does not have it. From 6 April 2009, the following changes come into effect:
- Couples without children where one partner is subject to immigration control are not entitled to the couple element of working tax credit (WTC). Couples in this situation who were previously entitled to the couple element will lose it from 6 April 2009.
Couples where one partner is subject to immigration control and has not been allocated a national insurance number (NINO) are no longer subject to the NINO requirement for that person for the tax credits claim. This should ease problems where claims were delayed because the partner subject to immigration control did not have a NINO.
Sending claims and reporting changes to the Revenue
From 6 April 2009, the following change comes into effect:
- The definition of an appropriate office for tax credits claims and notifications is Comber House, Farriers Way, Netherton, Merseyside (the address on the return envelope for new claims) or any other office specified in writing by the Revenue (such as by telephoning the Helpline).
- This removes the option for claimants to report changes to a DWP office or even a Revenue enquiry centre if this has not been specified in writing to the claimant. It is not clear how this change will interact with the ‘In and Out of Work’ joint working pilots between the Revenue, DWP and local authorities, or the Revenue’s plans to ensure that claimants who receive tax credits and Child Benefit only have to report changes once.
Child Trust Fund
The Child Trust Fund (CTF) is a savings account for children. Children born on or after 1 September 2002 receive £250 which cannot be touched until they turn 18. It is administered by the Revenue and basic eligibility is linked to child benefit claims. A £250 voucher should be sent out within one month of child benefit being claimed. It starts from the date child benefit was awarded (usually the date of birth) and is valid for one year. An additional £250 payment should be made automatically to children for whom maximum child tax credit (CTC) is payable.
New regulations from April 2009 allow the additional payment to be made if a CTC claim is made before the expiry date on the voucher (i.e. within one year of the date child benefit started). The effect of this change is that people who received a CTF voucher within the past year and claimed CTC up to one year after the birth (or child benefit claim) may be eligible for the additional payment. The additional payment should be made into the account automatically and it is not necessary to make a claim.
