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HMRC internal manual

Tax Credits Manual

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HM Revenue & Customs
Updated
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Renewals - Annual Declaration (general): Late declaration received - consider new claim

Checklist

Before you follow this guidance, make sure

  • you have read and understood the guidance in TCM0138020
  • you have read and understood the guidance in TCM0262120
  • you have the correct user roles to follow this guidance
  • you are in the correct MU. Use TCM0322460 for the correct MU number
  • you have access to the Self Assessment 2000 (SA) system
  • you have access to the National Insurance and Pay As You Earn System (NPS).

Background

When a customer is late providing us with their renewal details, and either ‘good cause’ has been refused, or the renewal details are provided between the 1 February and the 5 April of the same tax year, we will not restore the claim. However, we have to treat the late declaration as being a new claim from the date the renewal details were received.

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.

Universal Credit

Universal Credit is a new benefit that is replacing a range of existing benefits including tax credits.  If the custome and/or their partner are of working age and living in a Universal Credit area, the law states they are not eligible to tax credits but can claim Universal Credit.  To do this they will need to claim online at gov.uk

Note: Before capturing a new claim, you must check whether the household is in a closed postcode area to prevent new claims being issued / captured from working aged customers.  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.  For how to do this, use TCM1000628

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Step 1

If you are dealing with a new case, go to Step 2.

If you have previously issued a TC664 or a TC1221 and the action date has expired, go to Step 12.

If you have previously issued a TC664 or a TC1221 and a reply has been received, go to Step 15.

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Step 2

Check whether the customer’s postcode and their partner’s, if applicable, was open to tax credits on the received date of the late declaration and whether the customer and / or their partner is of Pension Credit Qualifying Age (PCQA). For how to do this, use TCM1000628.

Note:  customers living in a postcode area closed to tax credits can only claim if the household contains an individual who is of PCQA

If the customer is entitled to claim tax credits, go to Step 3

If the customer is not entitled to claim tax credits

  • send the customer a TC1138 (selecting the option relevant to your case), advising them to claim Universal Credit
  • Update household notes with the message TG06 from TCM0174020, for how to do this, use TCM1000001
  • Take no further action

Step 3

Check and note RTI figure. For how to do this, use TCM1000011.

If RTI data available, go to Step 4.

If RTI data not available, go to Step 5.

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Step 4

If the customer has provided an earned income figure that is equal to or more than the RTI figure we have obtained

  • make a note of the income on the TC648 to use the income figure declared by the customer, as you will need this later
  • go to Step 5.

If the customer has provided an earned income figure less than the RTI figure we have obtained and the difference is within £500

  • make a note of the income on the TC648 to use the income figure declared by the customer, as you will need this later
  • go to Step 5

If the customer has provided an earned income figure less than the RTI figure we have obtained and the difference is £500 or more

  • make a note on TC648, you will have to contact the customer to challenge the income discrepancy
  • go to Step 5.

If the customer has not provided an earned income figure

  • make a note on TC648, you will have to contact the customer to obtain their income details
  • go to Step 5.

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Step 5

If you are dealing with a Late Declaration e-form referral from the Contact Centre, go to Step 6.

If you are dealing with anything else, go to Step 7.

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Step 6

Check the referral to see if a change of circumstance has been provided for PY or CY.

Note: This refers to changes other than the income details provided.

If a change of circumstance has been provided for PY or CY and no RTI discrepancy, go to Step 8.

If a change of circumstance has not been provided for PY or CY and no RTI discrepancy

  • send the customer a TC1138 (selecting the option relevant to your case) to notify them that we are capturing a new claim
  • update Household Notes with the message SW29 from TCM0172080. For how to do this, use TCM1000001
  • go to Step 18.

If a change of circumstance has been provided for PY or CY and there is an RTI discrepancy, go to Step 32.

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Step 7

Check to see if a change of circumstance has been reported with the declaration.

Note: The customer might have notified us of a change by ticking the relevant Statement of Circumstance (SOC) box, on an attachment with a manual declaration, or in Household Notes.

Note: This refers to changes other than the income details provided.

If a change of circumstance has been provided for PY or CY, go to Step 8.

If a change of circumstance has not been provided for PY or CY

  • send the customer a TC1138 (selecting the relevant option for to your case) to notify them that we are capturing a new claim
  • update Household Notes with the message SW29 from TCM0172080. For how to do this, use TCM1000001
  • go to Step 18.

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Step 8

Check if you have all the details required to make the change.

If you do not have all the details required to make the change

  • make a note of the missing details on the TC648
  • go to Step 9.

If you do have all the details required to make the change, go to Step 9.

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Step 9

Check to see if the Declaration is complete. For how to do this use TCM1000003.

If the Declaration is complete, go to Step 10.

If the Declaration is not complete

  • make a note of the missing details on the TC648
  • go to Step 10.

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Step 10

Check the TC648 to see if you require any information from the customer.

Note: This includes where you have made a note at Step 3 to challenge the customer’s income details.

Note: Deduct any allowable deductions from income. For how to do this, use TCM0322175.

If you need any information from the customer, go to Step 11 

If you do not need any information from the customer, go to Step 22 

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Step 11

Contact the customer by phone. Follow the guidance in TCM0094080.

If you are able to contact the customer by phone

  • confirm what the change/RTI discrepancy is and make a note of all the required details
  • go to Step 22.

If you are not able to contact the customer by phone

  • send a TC664 and a TC1221 to the customer to confirm what the changes are and the relevant dates. For how to do this, use TCM1000009
  • set an action date for 30 days in the future. For how to do this, use TCM1000008
  • update Household Notes with the message SW30 from TCM0172080. For how to do this, use TCM1000001
  • go to Step 19.

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Step 12

Check Household Notes to see if the customer has called to provide the details requested. For how to do this, use TCM1000067.

If the missing details have been provided, go to Step 26.

If the missing details have not been provided, go to Step 13.

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Step 13

Check whether the customer’s postcode and their partner’s, if applicable, was open to tax credits on the received date of the late declaration and whether the customer and / or their partner is of Pension Credit Qualifying Age (PCQA). For how to do this, use TCM1000628.

Note:  customers living in a postcode area closed to tax credits can only claim if the household contains an individual who is of PCQA

If the customer is entitled to claim tax credits, go to Step 14

If the customer is not entitled to claim tax credits

  • send the customer a TC1138 (selecting the option relevant to your case) to advise them to claim Universal Credit
  • update household notes with the message TG06 from TCM0174020, for how to do this, use TCM1000001
  • remove all the work details from the logged claim. For how to do this, use TCM1000512
  • reject the claim. For how to do this use TCM1000514
  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action

 

Step 14

If you have some of the details relating to the change

Note: For example: you know the change relates to work, but you do not have the relevant dates, hours or employment details.

  • send a TC1138 (selecting the option relevant to your case) to the customer to notify them that we are capturing a new claim
  • update Household Notes with the message SW35 from TCM0172080. For how to do this, use TCM1000001
  • go to Step 30.

If you do not have any of the details relating to the change

Note: For example: the customer has ticked the SOC box indicating a change, but they have not responded to our request for further information.

  • send a TC823A to the customer informing them of our inability to capture their new claim
  • update Household Notes with the message SW31 from TCM0172080. For how to do this, use TCM1000001
  • go to Step 20.

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Step 15

Check the reply to see if the customer has provided all the information.

If the customer has provided you with all the information that you required,go to Step 26.

If the customer has not provided you with all the information that you required,go to Step 16.

Step 16

Check whether the customer’s postcode and their partner’s, if applicable, was open to tax credits on the received date of the late declaration and whether the customer and / or their partner is of Pension Credit Qualifying Age (PCQA). For how to do this, use TCM1000628.

Note:  customers living in a postcode area closed to tax credits can only claim if the household contains an individual who is of PCQA

If the customer is entitled to claim tax credits, go to Step 17

If the customer is not entitled to claim tax credits

  • send the customer a TC1138 (selecting the option relevant to your case) to advise them to claim Universal Credit
  • update application notes with the message TG06 from TCM0174020, for how to do this, use TCM1000028
  • remove all the work details from the logged claim. For how to do this, use TCM1000512
  • reject the claim. For how to do this use TCM1000514
  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action.

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Step 17

If you have some of the details relating to the change

Note: For example: you know the change relates to work, but you do not have the relevant dates, hours or employment details.

  • send a TC1138 (selecting the option relevant to your case) to the customer to inform them that we are capturing a new claim
  • update Household Notes with the message SW35 from TCM0172080. For how to do this, use TCM1000001
  • go to Step 21.

If you do not have any of the details relating to the change

Note: For example: the customer has ticked the SOC box indicating a change, but they have not responded to our request for further information.

  • send a TC823A to the customer to inform them of our inability to capture their new claim
  • update Household Notes with the message SW32 from TCM0172080. For how to do this, use TCM1000001
  • go to Step 20.

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Step 18

Capture and process a new claim on the system. For how to do this use TCM0256200.

Note: Treat the received date of claim as the date the annual declaration was made.

  • consider backdating up to 31 days, following the guidance in TCM0022100 and amend the ‘effective date’ accordingly

Note: Where you have changes to apply that occurred within the backdated period, you will need to record these changes on the free format screen. For how to do this use TCM1000036.

  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action.

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Step 19

Capture and Store a new claim on to the system. For how to do this use TCM0256200.

Note: Where the household has broken down within 31 days of the date the declaration was made, treat the received date of claim as the day before the household broke down.

  • consider backdating up to 31 days, following the guidance in TCM0022100 and amend ‘effective date’ accordingly

Note: Ensure that you ‘store’ the claim rather than ‘processing’.

  • update Application Notes with the message QR02 from TCM0170020. For how to do this, use TCM1000028
  • take no further action.

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Step 20

Remove all the child details from the logged claim. For how to do this, use TCM1000300

  • remove all the work details from the logged claim. For how to do this, use TCM1000512
  • update the Application Notes with the message QR04 from TCM0170020. For how to do this, use TCM1000028
  • reject the claim. For how to do this use TCM1000514
  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action.

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Step 21

If you have written to the customer to confirm separate income for each customer and they did not reply to our enquiries

  • update the new claim with the income figure £99999 in one of the customers income fields. For how to do this, use TCM1000201
  • update the Application notes with the message QR06 from TCM0170020. For how to do this, use TCM1000028
  • continue to process the logged claim
  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action.

If you have written to the customer to confirm a change of circumstance and they did not reply to our enquiries

For example: you know the change relates to work, but you have not got all the required information, you would remove the work details to end Working Tax Credit (WTC) entitlement.

  • update the Application Notes with the message QR03 from TCM0170020. For how to do this, use TCM1000028
  • continue to process the logged claim
  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action.

If you have written to the customer to confirm a change of circumstance and the customer has supplied the details requested

  • update the new claim with the information received
  • update the Application Notes with the message QR05 from TCM0170020. For how to do this, use TCM1000028
  • continue to process the logged claim

Note: You must also consider the previous terminated claim. If the changes affect the previous claim, follow the guidance in TCM0042280.

  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action.

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Step 22

Check if the change reported refers to a household breakdown.

If the change does refer to a household breakdown, go to Step 23.

If the change does not refer to a household breakdown

  • consider applying the change following the guidance in TCM0042260 and then return to this step
  • send the customer a TC1138 to inform them that we are capturing a new claim
  • update Household Notes with the message SW29 from TCM0172080. For how to do this, use TCM1000001
  • go back to Step 18.

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Step 23

Check whether the household breakdown occurred in PY or CY.

If the household breakdown occurred in CY and was within 31 days immediately before the declaration was made

  • send the customer a TC1138 to inform them that we are capturing a new claim
  • update Household Notes with the message SW29 from TCM0172080. For how to do this, use TCM1000001
  • go to Step 24.

If the household breakdown occurred in PY

  • consider applying the change following the guidance in TCM0042260 and then return to this step
  • go to Step 25.

If the household breakdown occurred in CY and was not within 31 days immediately before the declaration was made, go to Step 25.

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Step 24

Capture a new claim on the system. For how to do this use TCM0256200.

Note: Treat the received date of the claim as the day before the date the household broke down.

  • consider backdating up to 31 days from the date the annual declaration was made. For how to do this, use TCM0022100 and amend the ‘effective date’ accordingly

Note: You must apply the household end date before putting the award in payment.

  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action.

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Step 25

Send a TC1138 (selecting the relevant option to your case) to the customer to advise them they will need to submit a new claim

  • update Household Notes with the message SW34 from TCM0172080. For how to do this, use TCM1000001
  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action.

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Step 26

Check if the change being reported refers to a household breakdown.

If the change does refer to a household breakdown, go to Step 28.

If the change does not refer to a household breakdown

  • consider applying the change following the guidance in TCM0042260 and then return to this guidance at Step 27

 

Step 27

Check whether the customer’s postcode and their partner’s, if applicable, was open to tax credits on the received date of the late declaration and whether the customer and / or their partner is of Pension Credit Qualifying Age (PCQA). For how to do this, use TCM1000628.

Note:  customers living in a postcode area closed to tax credits can only claim if the household contains an individual who is of PCQA

If the customer is entitled to claim tax credits

  • send the customer a TC1138 (selecting the relevant option to your case) to inform them that we are capturing a new claim
  • update Household Notes with the message SW29 from TCM0172080. For how to do this, use TCM1000001
  • go back to Step 21

If the customer is not entitled to claim tax credits

  • send the customer a TC1138 (selecting the relevant option to your case) to advise them to claim Universal Credit
  • update application notes with the message TG06 from TCM0174020, for how to do this, use TCM1000028
  • remove all the work details from the logged claim. For how to do this, use TCM1000512
  • reject the claim. For how to do this use TCM1000514
  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action.

 

Step 28

Check whether the customer’s postcode and their partner’s, if applicable, was open to tax credits on the received date of the late declaration and whether the customer and / or their partner is of Pension Credit Qualifying Age (PCQA). For how to do this, use TCM1000628.

Note:  customers living in a postcode area closed to tax credits can only claim if the household contains an individual who is of PCQA

If the customer is entitled to claim tax credits, go to Step 29

If the customer is not entitled to claim tax credits

  • send the customer a TC1138 (selecting the relevant option to your case) to advise them to claim Universal Credit
  • update application notes with the message TG06 from TCM0174020, for how to do this, use TCM1000028
  • remove all the work details from the logged claim. For how to do this, use TCM1000512
  • reject the claim. For how to do this use TCM1000514
  • send any relevant correspondence to storage, follow the guidance in TCM0074140
  • take no further action.

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Step 29

Check whether the household breakdown occurred in PY or CY.

If the household breakdown occurred in PY

  • consider applying the change following the guidance in TCM0042260 and then return to this step
  • send the customer a TC1138 (selecting the relevant option to your case) to inform them that they will need to submit a new claim
  • update Household Notes with the message SW34 from TCM0172080. For how to do this, use TCM1000001
  • go back to Step 20.

If the household breakdown occurred in CY and was not within 31 days immediately before the declaration was made

  • send the customer a TC1138 (selecting the relevant option to your case) to inform them that they will need to submit a new claim
  • update Household Notes with the message SW34 from TCM0172080. For how to do this, use TCM1000001
  • go back to Step 20.

If the household breakdown occurred in CY and was within 31 days immediately before the declaration was made

  • send the customer a TC1138 (selecting the relevant option to your case) to inform them that we are capturing a new claim
  • update Household Notes with the message SW29 from TCM0172080. For how to do this, use TCM1000001
  • go back to Step 21.

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Step 30

If RTI was checked, go to Step 31.

If RTI was not checked, go back to Step 21.

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Step 31

Deduct any allowable deductions from income. For how to do this, use TCM0322175, go back to Step 21.

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Step 32

Contact the customer by phone. Follow the guidance in TCM0094080.

If you are able to contact the customer by phone

  • confirm what the change/RTI discrepancy is and make a note of all the required details
  • deduct any allowable deductions from income. For how to do this, use TCM0322175
  • capture a new claim on to the system. For how to do this use TCM0256200

Note: Where the household has broken down within 31 days of the date the declaration was made, treat the received date of claim as the day before the household broke down.

  • consider backdating up to 31 days, following the guidance in TCM0022100 and amend ‘effective date’ accordingly

Note: Ensure that you ‘store’ the claim rather than ‘process’.

  • update Application Notes with the message QR02 from TCM0170020. For how to do this, use TCM1000028
  • take no further action.

If you are not able to contact the customer by phone

  • send a TC664 to the customer to confirm what the changes are and the relevant dates, and/or send a TC1221 for any RTI discrepancies. For how to do this, use TCM1000009
  • deduct any allowable deductions from income. For how to do this use, TCM0322175
  • set an action date for 30 days in the future. For how to do this, use TCM1000008
  • update Household Notes with the message SW30 from TCM0172080. For how to do this, use TCM1000001
  • take no further action.