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HMRC internal manual

Tax Credits Manual

From
HM Revenue & Customs
Updated
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Miscellaneous (A to B): Award calculation stage 3g - Tapering next entitlement (Info)

First, the taper start point for the next entitlement is calculated.

In most cases, it will be the amount of income already used to taper the previous entitlement to zero. However, in some cases the tax credit entitlements may have a minimum taper start point.

Where the entitlement has a minimum taper start point amount, the taper start point will be the greater of

  • the amount of income already used to taper the previous entitlement to zero

and

  • the minimum taper start point.

The taper start point for the entitlement can then be compared to the income.

  • Where the income is equal to, or less than, the taper start point for the entitlement, the maximum amounts of this and all the other remaining tax credit entitlements are due in full for that entitlement period.
  • Where the income is higher than the taper start point for the entitlement, the amount of income above the start point is used to taper the value of this entitlement. Follow the guidance in TCM0132280.