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HMRC internal manual

Tax Credits Manual

From
HM Revenue & Customs
Updated
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Eligibility - miscellaneous: Disability - qualifying benefits and fast track procedure (Info)

Qualifying benefits

A person passes the qualifying benefit test if any of the following apply

  • on at least one of the 182 days immediately before the date of claim, they were in receipt of one or more of the following

    • Severe Disablement Allowance
    • Short-Term Incapacity Benefit at the higher rate
    • Long-Term Incapacity Benefit
    • Employment and Support Allowance (ESA) which they have received for 28 weeks or more or where they have received a combination of ESA and Statutory Sick Pay (SSP) or Incapacity Benefit at the short-term higher or long-term rate or Severe Disablement Allowance or Income Support (IS) with a disability premium or higher pensioner premium has existed for a period of 28 weeks immediately preceding the qualifying day comprising one continuous period or two or more periods which are linked together
    • National Insurance credits awarded on the grounds of limited capability for work due to exhaustion of 12 months entitlement to contribution-based ESA. This criterion is only applicable from 30 April 2012.
  • on at least one of the 182 days immediately before the date of claim, they were in receipt of one or more of the following which included a disability premium or higher pensioner premium because of that person’s own disability

    • Income Support (IS)
    • Income-based Jobseeker’s Allowance (JSA)
    • Housing Benefit or Council Tax Reduction Scheme or Council Tax Benefit.

    Note: From 1 April 2013, Council Tax Benefit (CTB) ceased to exist and was replaced by localised support for Council Tax. As a consequence, claimants will no longer be able to rely on receipt of CTB which includes a disability premium to satisfy some or all of the qualifying conditions for Working Tax Credit or particular elements of Working Tax Credit. Customers’ payments will not be affected unless they stop being entitled to a disability element of Working Tax Credit for more than 8 weeks.

  • on one of the 56 days immediately preceding the date of claim, they were engaged in training for work and, for one or more of the 56 days immediately preceding the start of that period of training for work, they were receiving one of the following

    • short-term Incapacity Benefit at the higher rate
    • long-term Incapacity Benefit
    • Severe Disablement Allowance
    • contribution based Employment and Support Allowance (ESA (C)), where entitlement to this has existed for 28 weeks or where they have received SSP or Incapacity Benefit at the short-term higher or long-term rate or Severe Disablement Allowance, followed by ESA for a combined period of 28 weeks or more

    Note: On the days the customer received SSP they must have met the conditions to receive ESA (C).

    • National Insurance credits awarded on the grounds of limited capability for work due to exhaustion of 12 months entitlement to contribution-based ESA. This criterion is only applicable from 30 April 2012.

Fast track procedure

They have received for 140 days, the last of which falls in the 56 days immediately before the date of claim, one of the following

  • Statutory Sick Pay
  • short-term Incapacity Benefit at the lower rate
  • IS, on the grounds of incapacity for work
  • ESA, on the grounds of limited capability for work
  • National Insurance credits on account of either incapacity or limited capability for work
  • Occupational Sick Pay

and

  • they have a disability at the date of claim which is likely to last for at least six months or for the rest of their life
  • their gross earnings are at least 20% less than they were before the disability began, with a minimum reduction of £15.00 (gross) weekly.

Note: The 140 days need not be a continuous period. It can be made up of any periods of receipt of the benefits listed above which are separated by eight weeks or fewer.

8 week linking rule - case G

  • Where a claim for the disability element is made, or treated as made, within eight weeks of the end of a previous award of the disability element for that customer

and

  • the initial claim that resulted in that award of the disability element was based on one of the qualifying benefit tests above or Disabled Persons Tax Credit (DPTC).

Benefits currently in payment

  • on the date of claim, one of the following is payable to them

    • Attendance Allowance
    • Disability Living Allowance (DLA), Personal Independence Payment (PIP) or Armed Forces Independence Payment (AFIP)
    • War Disablement Pension with constant Attendance Allowance or Mobility Supplement
    • Industrial Injuries Disablement Benefit with constant Attendance Allowance
  • on the date of claim, they have an invalid carriage or other vehicle provided under the Invalid Vehicle Scheme.

Note: From 08/04/13 PIP will be introduced as a replacement for DLA for customers of working age (16-64 years of age). PIP will be made of two elements consisting of daily living and mobility and two levels of rates which are standard or enhanced. Customers under 16 and over 65 years old will remain on DLA.

Note: For tax credits purposes, the Highest Rate Care Component of DLA is the same as the Enhanced rate of daily living component of PIP, and will allow the customer to qualify for the Severe Disability element, so long as the other qualifying conditions are met. There is also an Enhanced rate of mobility component of PIP, but this does not allow the customer to qualify for the extra element.

Note: For tax credits purposes, the current low and middle rates of DLA (whether care or mobility) will be either standard daily living or standard mobility component of PIP, and will allow the customer to qualify for the Disability element so long as the other qualifying conditions are met.

Note: From 08/04/13 Armed Forces Independence Payment (AFIP) will be introduced to replace Disability Living Allowance (DLA) for members and ex-members of HM Forces (Army, Navy, Air Force etc). A customer entitled to AFIP will receive the benefit for life, at the equivalent Enhanced rate of Personal Independence Payment (PIP) or higher rate of DLA, and will entitle a tax credit customer to the severe disability element of Working Tax Credit. The Service Personnel and Veterans Agency (SPVA), a division of the Ministry of Defence, will administer AFIP. The Department for Work and Pensions are responsible for making AFIP payments and maintaining the awards.

Note: Where a person initially qualifies for the disability element as they were in receipt of one of the benefits under the final two bullet points above and they stop receiving that benefit, their entitlement to the disability element will stop.

Note: The person must be entitled to receive the qualifying benefit in his or her own right. An appointee for another person receiving any of the benefits listed above as an appointee does not satisfy the disability conditions simply by receiving the benefit.