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HMRC internal manual

Tax Credits Manual

From
HM Revenue & Customs
Updated
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Eligibility - childcare element (WTC): childcare charges - changes (Info)

Customers are obliged to notify Tax Credit Office (TCO) when a change occurs, during the period of an award, to the

  • relevant childcare charges

or

  • childcare provision.

Changes that are to be treated as a change in relevant childcare charges are

  • an increase or decrease in the average weekly charge of £10 or more weekly that the customer expects to be for at least four weeks

or

  • the average weekly charge is reduced to nil.

Customers can notify these changes in writing or by phone.

Where the original childcare charges were calculated using a fixed weekly payment, the change is calculated by averaging the weekly charge, in each of the four consecutive weeks that the change has occurred. This applies to each child for whom charges are incurred.

Where the original childcare charges were calculated using variable weekly payments, the change is calculated by averaging the anticipated weekly charge, for the following 52 weeks and dividing that figure by 52. This applies to each child for whom charges are incurred.

Where the original childcare charges were paid in a fixed monthly amount, the change is calculated by multiplying the new monthly figure by 12 and dividing the result by 52.

Where the original childcare charges were paid in variable monthly amounts, the anticipated amounts are averaged for the following 12 months and that figure is divided by 52.

Where there is more than one child, the increase or decrease in childcare charges, is the total increase or decrease for each child.

Where a change of circumstances occurs, entitlement to WTC is recalculated and the maximum rate of entitlement is increased or decreased from a specified date.