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HMRC internal manual

Tax Credits Manual

From
HM Revenue & Customs
Updated
, see all updates

Miscellaneous (W to Z): Withdrawing from tax credits

Checklist

Before you follow this guidance make sure

  • you follow the guidance in TCM0138020
  • you 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.

Background

A claim can only be withdrawn when it is

  • at pre-award status and no decision has been made on the claim
  • as a result of an operator error - for example, the same claim has been captured twice

or

  • when at post-award status and no award or payments have been made for the following tax year (CY+1). A request can be made to prevent an award being made in the following tax year (CY+1), but the current year (CY) must continue.

Note: The claim cannot be withdrawn once a decision has been made and it has been awarded.

Note: For tax year 2010-2011 Nil Award cases were automatically withdrawn and customers had until 17 May 2011 (this is known as the deadline date) to cancel the withdrawal. For tax year 2011-2012 a new or a existing Nil Award will be automatically withdrawn and customers will have until 31 March 2012 (this is known as the deadline date) to cancel the withdrawal.

Note: The first time the claim is involved in the withdrawal process the future withdrawal requested box will be blank. If the claim was involved in the bulk withdrawal exercise and the claim was withdrawn before the request was actioned an historic record will be shown.

Either customer can make a request in writing or verbally to withdraw from tax credits - either pre-award or post award. Where the claim is post award, use the withdrawal marker to ensure the following years claim is withdrawn.

Before withdrawing from tax credits, the customer must be fully informed of the consequences this action will have on their claim. This will enable them to decide whether to withdraw (except where it’s as a result of an operator error).

A system-generated Withdrawal Confirmation Notice (WCN) (form TC1013) is sent out from the beginning of February each year to customers who chose future withdrawal from tax credits. The WCN

  • asks the customer if they still want to withdraw
  • explains the consequences
  • asks them to call the Tax Credits Helpline to confirm their request.

Customers who have not requested a future withdrawal and are being automatically withdrawn, will be sent the TC1015 which explains the consequences of the withdrawal, the deadline date to contact and tells them to contact HMRC only if they wish to object to the withdrawal.

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 or Data Security Team for advice.

Step 1

If the customer wants to withdraw, go to

If the customer has already asked to be withdrawn, and their claim has not yet been withdrawn

  • check the status of the claim. For how to do this, use TCM1000025
  • go to

If the customer has received the TC1015, go to

If the customers claim has been withdrawn and they want to cancel the withdrawal, go to

If the customers claim has been withdrawn and they state they were misled by the TC1015 and / or they have an expected future change, go to

If the customers claim has been withdrawn and their income is lower than NTC and / or they report another change, go to

If the customer feels disadvantaged in any way because of the withdrawal exercise, go to

Step 2

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

If the claim is pre-award, go to

If the claim is rejected, ceased or terminated go to

If the claim is post award, go to

If the claim is withdrawn, go to

Step 3

Where the claim is pre-award

  • update Application Notes with the message NV15 from TCM0164040. For how to do this, use TCM1000028

Note: You must update Application Notes before withdrawing the claim because adding a message after this will resurrect the claim.

  • withdraw the claim on the tax credits computer. For how to do this, use TCM1000226
  • contact the customer and tell them

    • you have withdrawn their claim
    • if they want to claim tax credits again, they will have to make a new claim.

    Follow the guidance in TCM0094080

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

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000) (This content has been withheld because of exemptions in the Freedom of Information Act 2000) (This content has been withheld because of exemptions in the Freedom of Information Act 2000) TCM0164040(This content has been withheld because of exemptions in the Freedom of Information Act 2000) TCM1000028

(This content has been withheld because of exemptions in the Freedom of Information Act 2000) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000) TCM1000226
  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000) TCM0074140
  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Step 4

Check today’s date

If today’s date is between 6 April and the claim’s first specified date, go to

If today’s date is not between 6 April and the claim’s first specified date, go to

Step 5

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

If the CY award is provisional

Attempt to contact the customer by phone

  • tell the customer

    • I need to tell you some important information about withdrawing from tax credits
    • if, after withdrawing, you want to claim tax credits again, you will have to make a new claim. Any new award can only be backdated up to a maximum of 31 days
    • if you receive any of the following benefits: Income Support, income-based Jobseeker’s Allowance, income-related Employment and Support Allowance or Pension Credit, you will not get any extra money for your child or children through these benefits
    • we will still need to finalise your award so you will need to follow the instructions in the tax credits renewal pack that we’ll send you after the end of this tax year
    • if there is any overpayment when we decide the final amount due, you will still have to pay that back
    • if we are using some or all of your current tax credits to repay an overpayment and you withdraw from the scheme, any amount that you still owe will have to be paid back.
  • ask the customer ‘Do you still want to withdraw from tax credits?’
  • go to

If you can not contact the customer by phone, go to

If the CY award is not provisional, go to

Step 6

Note: The tax credits computer will automatically issue TC1013 Withdrawal Confirmation Notice (WCN) from the beginning of February each year to claimants who request their award to Tax Credits to be withdrawn.

Check on the tax credits computer if we have sent the customer a TC1013 (WCN). For how to do this, use TCM1000282

Check today’s date

If today’s date is between the claims first specified date and the issue of the TC1013 (WCN), go to

If today’s date is not between the claims first specified date and the issue of the TC1013 (WCN), go to

Step 7

Phone the customer to advise that it is too late for HMRC to withdraw their claim as their claim has already been renewed, follow the guidance in TCM0094080 for contacting the customer.

If you contact the customer by phone

  • tell the customer

    • it is too late to withdraw from tax credits for this year because we have already renewed your claim
    • we can withdraw you from tax credits at the end of the tax year
    • we need to tell you some important information about withdrawing from tax credits
    • if, after withdrawing, you want to claim tax credits again, you will have to make a new claim. Any new award can only be backdated up to a maximum of 31 days
    • we still need to finalise your award so you will need to follow the instructions in the tax credits renewal pack that we will send you after the end of this tax year
    • if there is any overpayment when we decide the final amount due, you will still have to pay that back.
  • ask the customer ‘Do you still want to withdraw from tax credits?’
  • go to

If you can not contact the customer by phone, go to

Step 8

Check whether the customer has received a TC1013

If the customer has received a TC1013 and wants to withdraw, go to

If the customer has received a TC1013 and does not want to withdraw, go to

If the customer has not received a TC1013, go to

Step 9

Phone the customer to explain the consequences of withdrawing from tax credits. Follow the guidance in TCM0094080

If you cannot contact the customer by phone, go to

If you contact the customer by phone

  • tell the customer

    • I need to tell you some important information about withdrawing from tax credits
    • if, after withdrawing, you want to claim tax credits again, you will have to make a new claim. Any new award can only be backdated up to a maximum of 31 days (Prior to 6 April 2012 a new award can only be backdated up to a maximum of 93 days)
    • we will still need to finalise your award so you will need to follow the instructions in the tax credits renewal pack that we’ll send you after the end of this tax year
    • if there is any overpayment when we decide the final amount due, you will have to pay that back by direct payment.
  • ask the customer ‘Do you still want to withdraw from tax credits?’
  • go to

Step 10

If the customer still wants to withdraw from tax credits

  • tell them ‘We will withdraw you from tax credits at the end of the tax year’
  • end the call
  • go to

If the customer does not want to withdraw from tax credits

  • tell them ‘We will not withdraw you from tax credits’
  • end the call
  • go to

Step 11

If the customer wants to withdraw from tax credits now

  • tell them ‘We will withdraw you from tax credits immediately’
  • end the call
  • go to

If the customer wants to withdraw from tax credits at the end of the tax year

  • tell them ‘We will withdraw you from tax credits at the end of the tax year’
  • end the call
  • go to

If the customer does not want to withdraw from tax credits

  • tell them ‘We will not withdraw you from tax credits’
  • end the call
  • go to

Step 12

Phone the customer if it is too late to withdraw. Follow the guidance in TCM0094080

If you cannot contact the customer by phone, go to

If you contact the customer by phone

  • tell the customer

    • it is too late to withdraw from tax credits for this tax year because we have already renewed your claim
    • we can withdraw you from tax credits at the end of the tax year
    • we need to tell you some important information about withdrawing from tax credits
    • if, after withdrawing, you want to claim tax credits again, you will have to make a new claim. Any new award can only be backdated up to a maximum of 31 days
    • we still need to finalise your award so you will need to follow the instructions in the tax credits renewal pack that we will send you after the end of this tax year
    • if there is any overpayment when we decide the final amount due, you will still have to pay that back.
  • ask the customer ‘Do you still want to withdraw from tax credits?’
  • go to

Step 13

If the customer still wants to withdraw from tax credits

  • tell them ‘We will withdraw you from tax credits at the end of the tax year. If you change your mind or your circumstances change you need to tell us’
  • end the call
  • go to

If the customer does not want to withdraw from tax credits

  • tell them ‘We will not withdraw you from tax credits’
  • end the call
  • go to

Step 14

Phone the customer to tell them we cannot withdraw them because they do not have a current award. Follow the guidance in TCM0094080

If you cannot contact the customer by phone, go to

If you contact the customer by phone

  • tell the customer ‘We cannot withdraw you from tax credits because you do not have a current award’
  • end the call
  • update Household Notes with the message NV12 from TCM0164040. For how to do this, use TCM1000001
  • send the documents to storage. Follow the guidance in TCM0074140
  • take no further action.

Step 15

Phone the customer to tell them they have already been withdrawn from tax credits. Follow the guidance in TCM0094080

Note: When the customer has withdrawn from tax credits, their claim cannot be resurrected. The customer must make a new claim.

If you cannot contact the customer by phone, go to

If you contact the customer by phone

  • tell the customer

    • you will have to make a new claim if you want to claim tax credits again
    • we can only backdate a new award up to a maximum of 31 days (prior to 6 April 2012 a new award can only be backdated up to a maximum of 93 days).
  • end the call
  • update Household Notes with the message NV13 from TCM0164040. For how to do this, use TCM1000001
  • send the documents to storage. Follow the guidance in TCM0074140
  • take no further action.

Step 16

Obtain the customer’s address from the tax credits computer. For how to do this, use TCM1000111

  • open a blank letter TC1061
  • update letter TC1061 with the customer’s

    • name
    • address
    • NINO
  • send letter TC1061 to the customer
  • update Household Notes with the message NV14 from TCM0164040. For how to do this, use TCM1000001
  • take no further action.

Step 17

If the customer’s claim has been withdrawn and they contact us after 31 March 2012 for Tax Year 11/12 (or after 17 May 2011 for Tax Year 10/11)

If the customer’s claim has been withdrawn, they contacted us before 31 March 2012 for Tax Year 11/12 (or before 17 May 2011 for Tax Year 10/11)

  • go to

If the customer’s claim has not yet been withdrawn, they contacted us before 31 March 2012 for Tax Year 11/12

  • go to

If the customer’s claim has not yet been withdrawn, they contacted us after 31 March 2012 for Tax Year 11/12

  • invite a fresh claim. For how to do this, follow the guidance in TCM0044080.

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.

Step 18

Check whether the customer received the TC1015 (Where you are contacting the customer by phone, follow the guidance in TCM0094080, follow the guidance at for contacting the customer in writing)

If the customer received the TC1015

  • tell the customer

    • we cannot cancel your request to withdraw from tax credits as it has already been withdrawn
    • if you want to claim tax credits again, you will have to make a new claim. Any new award can only be backdated up to a maximum of 31 days (prior to 6 April 12 a new award can only be backdated up to a maximum of 93 days)
    • you must phone the Tax Credits Helpline if you want to make a new claim.
  • update Household Notes with the message NV11 from TCM0164040. For how to do this, use TCM1000001
  • send the documents to storage. Follow the guidance in TCM0074140
  • take no further action.

If the customer did not receive the TC1015, go to

Step 19

Check whether the customer wants to cancel the withdrawal.

If the customer wants to cancel the withdrawal, go to

If the customer does not want to cancel the withdrawal, take no further action.

Step 20

If the ‘Withdrawal Confirm’ checkbox has not been populated

  • take no further action.

If the ‘Withdrawal Confirm’ checkbox has been populated

  • check whether the customer called on or before the deadline date

Note: the deadline date for Tax Year 10/11 was 17 May 2011 and for Tax Year 11/12 is 31 March 2012

  • go to

Step 21

If the customer called on or before the deadline date

  • cancel the withdrawal on the tax credits computer. For how to do this, use TCM1000282
  • update Household Notes with the message NV10 from TCM0164040. For how to do this, use TCM1000001
  • send the documents to storage. Follow the guidance in TCM0074140
  • take no further action.

If the customer did not call on or before the deadline date

  • check whether the customer received the TC1015. For how to do this, use TMC0094080
  • go to

Step 22

 If the customer received the TC1015

  • invite a fresh claim.  For how to do this, follow the guidance in TCM0044080

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.

If the customer did not receive the TC1015 and the claim has not been withdrawn

  • cancel the withdrawal on the tax credits computer. For how to do this, use TCM1000282
  • update Household Notes with the message NV10 from TCM0164040. For how to do this, use TCM1000001
  • send the documents to storage. Follow the guidance in TCM0074140
  • take no further action.

If the customer did not receive the TC1015 and the claim has been withdrawn

  • check whether today’s date is 9 months or more from the deadline date
  • go to

Step 23

If today’s date is 9 months or more from the deadline date

  • consider contacting the Technical Advice Line for guidance

If today’s date is not more than 9 months from the deadline date

  • check whether the S17 has been issued
  • go to

Step 24

Check whether the customer has made a new claim

Note: When the customers claim has been withdrawn they may have made a new claim, HMRC must check there are no overlapping awards

If the customer has made a new claim

  • make a note of the start date of the new award
  • go to

If the customer has not made a new claim

  • go to

Step 25

Check if today’s date is on or before the claims first specified date, for how to do this use TCM1000002

If today’s date is on or before the claims first specified date

  • go to

If today’s date is after the claim’s first specified date

  • go to

Step 26

If the S17 has not been issued and a new claim has been made

  • go to

If the S17 has not been issued and a new claim has not been made

  • apply CY changes only
  • remove the household end date
  • tell the customer to complete the S17
  • update Household Notes with the message NV17 from TCM0164040 for how to do this use TCM1000001
  • take no further action.

If the S17 has been issued

  • check whether the PY has been finalised
  • go to .

Step 27

If the PY has been finalised and a new claim has been made

  • apply any changes of circumstance
  • update Household Notes with the message NV17 from TCM0164040 for how to do this use TCM1000001
  • go to .

If the PY has been finalised and a new claim has not been made

  • apply any changes of circumstance
  • remove the household end date
  • update Household Notes with the message NV17 from TCM0164040 for how to do this use TCM1000001
  • take no further action.

If the PY has not been finalised

  • check whether the customer can provide information to finalise the claim
  • go to

Step 28

If the customer can provide information to finalise the claim and a new claim has been made

  • capture the S17 details
  • update Household Notes with the message NV17 from TCM0164040 for how to do this use TCM1000001
  • go to .

If the customer can provide information to finalise the claim and a new claim has not been made

  • capture the S17 details and remove the household end date
  • update Household Notes with the message NV17 from TCM0164040 for how to do this use TCM1000001
  • take no further action.

If the customer cannot provide information to finalise the claim and a new claim has been made

  • apply the CY change only
  • update Household Notes with the message NV17 from TCM0164040 for how to do this use TCM1000001
  • mark the S17 as not served, and tell customer they will be sent a new S17.
  • go to .

If the customer cannot provide information to finalise the claim and a new claim has not been made

  • apply the CY changes only
  • remove the household end date
  • update Household Notes with the message NV17 from TCM0164040 for how to do this use TCM1000001
  • mark the S17 as not served, and tell customer they will be sent a new S17.

Step 29

If the customer wants to withdraw from tax credits now

  • withdraw the claim on the tax credits computer. For how to do this, use TCM1000282
  • update Household Notes with the message NV04 from TCM0164040 for how to do this use TCM1000001
  • send the documents to storage. Follow the guidance in TCM0074140
  • take no further action.

Step 30

If the customer wants to withdraw from tax credits at the end of the tax year

  • mark the claim for future withdrawal on the tax credits computer. For how to do this, use TCM1000282
  • update Household Notes with the message NV06 from TCM0164040. For how to do this, use TCM1000001
  • send the documents to storage. Follow the guidance in TCM0074140
  • take no further action.

Step 31

If the customer does not want to withdraw from tax credits

  • if there is a withdrawal marker, remove following the guidance in TCM1000282
  • update Household Notes with the message NV03 from TCM0164040. For how to do this, use TCM1000001
  • send the documents to storage. Follow the guidance in TCM0074140
  • take no further action.

Step 32

If the customer still wants to withdraw from tax credits

  • mark the claim withdrawal confirmed on the tax credits computer. For how to do this use TCM1000282
  • update Household Notes with the message NV01 from TCM0164040. For how to do this use TCM1000001
  • send the documents to storage. Follow the guidance in TCM0074140
  • take no further action.

Step 33

Where the customers claim has been withdrawn and their income is lower than NTC, or

  • they are reporting another change
  • the withdrawal exercise has disadvantaged them in any way

then

  • complete the SEES entitlement calculator to establish if the customer is entitled in the current year

If there is potential entitlement for the current year and/or potential entitlement for the next year

  • go to

If there is no potential entitlement for the current year and the customer has stated they were misled or disadvantaged

  • the customers award will be nil for this year
  • go to

If there is no potential entitlement and the customers award is nil for this year, and the customer has not indicated any dissatisfaction

  • contact the customer and tell them

    • based on their current circumstances their award will be nil for this year
    • if they want to claim tax credits again they will have to make a new claim. Any new award can only be backdated up to a maximum of 31 days
    • they must phone the Tax Credits Helpline to make a new claim
  • update Household Notes with the message NV17 from TCM0164040 for how to do this use TCM1000001
  • take no further action.

Step 34

  • Complete an M1 referral form, for how to do this use TCM1000192

Note: check the ‘reason for referral’ box and select ‘incorrectly ended claim’. Include any change of circumstance the customer has reported in the ‘any additional information’ screen. The customer must not be told to complete a new claim form

Note: When a customer has made a new claim include the start date of the new award in the ‘any additional information’ screen

  • update household notes with the message NV17 from TCM0164040, for how to do this use TCM1000001
  • no further action.