Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

Tax Credits Manual

From
HM Revenue & Customs
Updated
, see all updates

Changes - work (general A-M): ESA/PC awarded/in payment customer working 16 or more hours a week

Background

This guidance is for when a customer tells you that

  • they are receiving income-related Employment and Support Allowance (ESA) or Pension Credit (PC) and working the 16 or more hours per week
  • their partner is receiving ESA or PC and working the 16 or more hours per week.

Note: If there are no children, the customer/partner needs to work 30 hours or more to be entitled to Working Tax Credit.

Note: From 6 April 2012, couples with children will be entitled to working tax credit if they are both aged 16 or over and

  • they work at least 24 hours a week between them, with one person working at least 16 hours a week. If only one person works, that person must be working at least 24 hours a week, or
  • one person works at least 16 hours a week and the other person cannot work because they are

    • incapacitated (in receipt of certain benefits because of a disability or ill health), or
    • an inpatient in hospital, or
    • in prison either on remand or serving a custodial sentence, or
  • one person works at least 16 hours a week and that person qualifies for the disability element of Working Tax Credit, or
  • one person works at least 16 hours a week and that person is aged 60 or over.

Note: Pension Credit - from 06/04/11 customers are only eligible if over 60 years old.

Checklist

Before you follow this guidance make sure you

  • follow the guidance in TCM0138020 
  • know how to use the SEES ‘Tax Credits Entitlement Calculator’
  • have the correct user roles to follow this guidance. Use the B&C Roles and Access Catalogue. You can find this by going to the Benefits & Credits homepage, selecting ‘R’ on the B&C A-Z index, selecting ‘Roles and Access Process’, selecting ‘Roles & Access Catalogue’ from the Related links menu
  • You are in the correct MU. Use TCM0322460 for the correct MU number.

Guidance

Note: when sending customer, staff or process data to another individual or team, make sure you follow the latest data security guidelines or contact the Data Guardian/Data Security Team for advice.

Step 1

If the claim is pre award, go to  

If the claim is post award, go to  

If you have been directed here from the guidance you were previously following, go to .

Step 2

Check that you have the required information for the customer in receipt of income-related Employment and Support Allowance (ESA) or Pension Credit (PC)

  • name of customer claiming/in receipt of ESA/PC
  • number of hours customer claiming/in receipt of ESA/PC working
  • start date of ESA/PC.

If you have all of the information, go to .

If you do not have all the information, follow the guidance in TCM0094080

  • go to

Step 3

Check to see if there is any compliance activity.

If there is compliance activity, follow the guidance in TCM0134440.

If there is no compliance activity, go to

Step 4

Work list item received notifying income-related Employment and Support Allowance (ESA) or Pension Credit (PC) is in payment to a Tax Credit customer who is working 16 or more hours per week

  • update Household Notes with the message II60 from TCM0160040. For how to do this, use TCM1000001 
  • make a note of the actual hours worked on TC648
  • make complete and process into award. For how to do this, use TCM1000106 
  • apply free format. For how to do this, use TCM1000233 

Note: If there are any change of circs. noted in the free format screen make a note of these.

  • set the ‘Complex Case’ and ‘Manual Correspondence’ markers. For how to do this, use TCM1000136 

Note: The ‘Complex Case’ and ‘Manual Correspondence’ markers won’t be set until you complete the ‘Amend Finish’ screen.

  • suspend payment. For how to do this, use TCM1000232 
  • make a note of the actual hours worked in the Household notes. For how to do this, use TCM1000001 
  • check work list items for any change of circs. and action these along with any other change of circs. noted earlier in the free format screen as per business as usual guidance
  • input a retained note COMPLEX CASE IN MANUAL PAYMENT DUE TO ESA/PC SEND ALL CHANGE OF CIRCS. TO UK COMPLEX MU
  • calculate on SEES the award due. For how to do this, use TCM1000491 
  • complete a manual award notice using the actual hours worked. Follow the guidance in TCM0184100 
  • pass to your line manager for checking
  • go to .

Step 5

If you have received a Work Area Mailbox (WAM) referral or correspondence from the customer notifying income-related Employment and Support Allowance (ESA) or Pension Credit (PC) is in payment to the Tax Credit customer who is working 16 or more hours per week

  • check work list items, and Household notes for any other change of circumstances ‘COC’. For how to do this, use TCM1000067 

If there are other change of circumstances, go to

If there are no other change of circumstances, go to .

Step 6

Set the ‘Complex Case’ and ‘Manual Correspondence’ markers. For how to do this, use TCM1000136 

Note: The ‘Complex Case’ and ‘Manual Correspondence’ markers won’t be set until you complete the ‘Amend Finish’ screen.

  • suspend payment. For how to do this, use TCM1000232 

Check whether Cross Award Recovery (CAR) was underway before the claim became Complex. For how to do this, use TCM1000117 

If cross award recovery was underway before the claim became complex, go to .

If cross award recovery was not underway before the claim became complex, go to .

Step 7

Use Cross Award Summary screen to identify relevant years. For how to do this use TCM1000561 

  • set Appeal markers on relevant years to send the overpayment back to the originating year. For how to do this use TCM1000444 
  • update Household Note with message ON19 from TCM0166040. For how to do this use TCM1000001 
  • BF the claim for 1 day to allow the overpayment to be sent back overnight

On expiry of this BF period

  • remove any Appeals marker you have set. For how to do this use TCM1000453 
  • go to .

Step 8

If there are other change of circumstances (COC) 

  • action all other ‘COC’ in the order they were received as per normal business as usual guidance
  • make a note of the ‘COC’ in the Household notes box. For how to do this, use TCM1000001.
  • go to .

Step 9

If there are no other change of circumstances (COC) 

  • set the ‘ Complex Case’ and ‘ Manual Correspondence’ markers. For how to do this, use TCM1000136 

Note: The ‘Complex Case’ and ‘ Manual Correspondence’ markers won’t be set until you complete the ‘Amend Finish’ screen.

  • suspend the payments. For how to do this, use TCM1000232 

Note: This will create a ‘Suspended Payment’ work list item.

  • calculate on SEES the award due. For how to do this, use TCM1000491 
  • make a note of the actual hours worked in the Household notes box and insert a retained note COMPLEX CASE IN MANUAL PAYMENT DUE TO ESA/PC SEND ALL CHANGE OF CIRCS. TO UK COMPLEX MU. For how to do this, use TCM1000001 
  • complete a manual award notice using the actual hours worked. Follow the guidance in TCM0184100 
  • pass to your line manager for checking
  • go to  

Step 10

Once checked and approved by your line manager pass the 

  • payment stencils to the manual payments team. For how to do this, use TCM1000110 
  • case papers to the renewals team.