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HMRC internal manual

Tax Credits Manual

From
HM Revenue & Customs
Updated
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Changes - work (general A-M): Hours - increase/decrease

Checklist

Before you follow this guidance make sure

  • you follow the guidance in TCM0138020
  • you check the Unprocessed Change of Circs work list for any outstanding entries and make a note of any information you require to clear the work item. Follow the guidance in TCM0054060 to clear the item on the Unprocessed Change of Circs work list only

Note: If the Unprocessed Change of Circumstances work list item is the same as the change you have been notified of, delete the work list item and continue with this guidance.

  • a change can be made. Follow the guidance in TCM0042260

Note: On a joint claim where there are children a reduction in working hours to less than 24 may not cease entitlement to WTC if the working person has a physical or mental disability which puts that person at a disadvantage in getting a job and satisfies Regulation 9(1)(c) or is aged at least 16 and undertakes work for not less than 16 hours per week and that persons partner is/can be treated as incapacitated or if the working person is aged at least 60. See information in TCTM02410 and guidance TCM0114120.

  • you have the correct user roles to follow this guidance. 
  • you are in the correct MU. Use TCM0322460.

Reasons not to follow this guidance

You do not need to follow this guidance if

  • the customer is changing job
  • the customer is starting employment
  • the customer is ending employment.

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 you are dealing with a four-week run-on referral from a Contact Centre or a paper change of circumstances, go to .

If you are dealing with a reply from a customer in response to our enquiry for further information, go to .

If you are dealing with an expired BF because the customer has not replied to our enquiry, go to .

If you are dealing with any other reason, go to .

Step 2

Check you have got the following details

  • end date of old hours
  • start date of new hours
  • new number of paid hours.

Note: If the customer has not provided all of the above details, check PAYE/RTI to obtain the information

If you do have all the details, go to .

If you do not have all the details

  • phone the customer to obtain the end date. Follow the guidance in TCM0094080
  • go to .

Note: If customer is on SA contact them to obtain the hours

Step 3

If you are able to contact the customer and they provide the missing information, go to .

If you are not able to contact the customer by phone

  • send form TC664 requesting the missing information
  • set a clerical date for 30 days in the future

Note: When calculating 30 days in the future, do not include postal strikes and public bank holidays in the calculation.

  • go to .

If you are able to contact the customer by phone but they are not able to provide the information

  • send form TC664 requesting the missing information
  • set a clerical date for 30 days in the future

Note: When calculating 30 days in the future, do not include postal strikes and public bank holidays in the calculation.

  • go to .

Step 4

If the claim is pre-award

  • update Application Notes with the message NA83 or NA85 from TCM0164020. For how to do this, use TCM1000028
  • take no further action.

If the claim is post award

  • update Household Notes with the message NA83 or NA85 from TCM0164020. For how to do this, use TCM1000001
  • take no further action.

Step 5

Check the status of the claim. For how to do this, use TCM1000025.

If the claim is pre-award

Note: From 6 April 2012, if a customer tells us within a month about a change of circumstances that increases the maximum rate of tax credits they are entitled to, their award can be amended from the date of the change. For changes notified after one month their award can only be amended one month prior to the date the change was notified.

Note: If a change is notified that does not alter or decreases the maximum rate of tax credits the customer is entitled to, it will be applied from the date of the change.

  • enter the details of the change on the free format screen. For how to do this, use TCM1000036
  • update Application Notes with the action you have taken. For how to do this, use TCM1000028
  • take no further action.

If the claim is post award, go to .

Step 6

Consider the customer entitlement to a four-week run-on. For how to do this, use TCM1000397.

If the customer is entitled to the four-week run-on, go to .

If the customer is not entitled to the four-week run-on, go to .

Step 7

Consider the status of the award. For how to do this, use TCM1000101.

Consider any exception changes within the four-week run-on period. For how to do this use TCM1000353.

If the claim has been ceased or terminated because of one of the four-week run-on exceptions

  • follow the guidance in TCM0228040
  • take no further action.

If the claim has been rejected, ceased or terminated and the customer’s new circumstances mean they may now qualify for tax credits

Note: Claims made on or after 6 April 2012 may be backdated up to 31 days.

Note: Claims made prior to 6 April 2012 may be backdated up to 93 days.

Note: Before you can invite a fresh claim, you must check whether the household is in a closed postcode area to prevent new claims being issued to working age households in these areas.  The exception to this is for those households that contain an individual of Pension Credit Qualifying Age (PCQA), as these will be allowed to claim tax credits.  Following the guidance in TCM0044080 will take you through the necessary steps.

  • invite them to make a fresh claim. Follow the guidance in TCM0044080 
  • take no further action.

If the claim has not been rejected, ceased or terminated

  • calculate the end date of the four-week run-on

Note: This is 28 days from and including the day after the old job ended.

  • go to .

Step 8

If the change occurred more than 28 days ago

  • make a note of the new effective date
  • update Household Notes with the message NE01 from TCM0164020. For how to do this, use TCM1000001
  • enter the new effective date in the hours worked end date field
  • go to .

If the change occurred not more than 28 days ago

  • make a note of the new effective date
  • add Household Note NE01 from TCM0164020. For how to do this, use TCM1000001
  • BF the case to the new effective date
  • take no further action.

Step 9

If the customers new hours allow or do not allow entitlement to WTC

  • enter the start date of the new hours as the day after the new effective date. For how to do this, use TCM1000364

Note: Be aware that as the new hours can not be backdated more than one month, you will need to record a period of hours at the old weekly hours to cover the gap between the end date of the old hours and the include date of the new hours.

Note: The new hours can not be backdated if it increases the entitlement to WTC.

Note: If the customer has not provided an end date, check PAYE/RTI to obtain the information.

Note: If you can’t get the information from PAYE/RTI use the date the customer notified us of the change.

  • apply any other relevant changes you have been notified of. Follow the relevant Changes guidance
  • go to .

Step 10

Note: From 6 April 2012, if a customer tells us within a month about a change of circumstances that increases the maximum rate of tax credits they are entitled to, their award can be amended from the date of the change. For changes notified after one month their award can only be amended one month prior to the date the change was notified.

Note: Consider any notified changes that do not alter or decreases the maximum rate of tax credits the customer is entitled to, it will be applied from the date of the change.

Note:Consider any change in hours that will increase the maximum tax credits award (that is, before any income changes are applied). For how to do this, use TCM1000347.

If the change in hours results in an increase in the maximum tax credits award (before any income changes) and we were notified within one month of the change

  • the change will be backdated to the start date of the new hours as the customer told us within the relevant period
  • record a period of hours at the old weekly hours to cover the gap between the start date of new hours and the include from date in worked hours history. For how to do this, use TCM1000364
  • enter the date, in the hours worked end date field, as the day prior to the date the new hours started
  • enter the actual start date of the new hours in work hours history. For how to do this, use TCM1000364
  • apply any other relevant changes you have been notified of. Follow the relevant Changes guidance
  • go to .

If the change in hours results in an increase in the maximum tax credits award (before any income changes) and we were not notified within one month of the change happening

Note: Be aware that as the new hours can not be backdated more than one month, you will need to record a period of hours at the old weekly hours to cover the gap between the end date of the old hours and the include date of the new hours.

  • enter the date, in the hours worked end date field, as the day prior to the date the new hours started
  • record a period of hours at the old weekly hours to cover the gap between the start date of new hours and the include from date in worked hours history. For how to do this, use TCM1000364
  • enter the actual start date of the new hours in work hours history. For how to do this, use TCM1000364
  • apply any other relevant changes you have been notified of. Follow the relevant Changes guidance
  • go to .

If the change in hours does not alter or decrease the maximum tax credits award (before any income changes)

  • enter the date, in the hours worked end date field, as the day prior to the date the new hours started
  • record a period of hours at the old weekly hours to cover the gap between the start date of new hours and the include from date in worked hours history. For how to do this, use TCM1000364
  • enter the new hours details in worked hours history. For how to do this, use TCM1000364

Note: Be aware you will need to amend the include date for the new hours to the date they started.

  • apply any other relevant changes you have been notified of. Follow the relevant Changes guidance
  • go to .

Step 11

Complete amend finish screen. For how to do this, use TCM1000032.

Note: If the work change applies to more than one tax year you must complete your action for each tax year affected, once you have followed the guidance in TCM0042260.

Note: Make sure you have applied all changes (including any unprocessed changes you are working) before you complete the ‘Amend Finish’ screen.

Note: Any changes you have made will not be applied until you complete the ‘Amend Finish’ screen.

If a warning message displayed and you had to pass the case to a Level 2 user or your manager, take no further action.

If a warning message displayed and you were able to make the change

  • update Household Notes with the appropriate message. For how to do this, use TCM1000001
  • go to .

If a warning message did not display

  • update Household Notes with the appropriate message. For how to do this, use TCM1000001
  • go to .

Step 12

If you have been working from a work list

  • delete the work list item. For how to do this, use TCM1000160
  • take no further action.

If you have been working a WAM referral

  • put the WAM referral in confidential waste
  • take no further action.

If you have been working an electronic referral

  • delete the item from the database
  • take no further action.

If you have been working a piece of correspondence

  • send the documents to storage, follow the guidance in TCM0074140
  • take no further action.