TCM0284080 - Specialist areas - complex: change of circumstances - complex to non-complex

Checklist

Note: From 27th January 2021, there are no new claims to tax credits

Before you follow this guidance, make sure you are in the correct MU. Use TCM0322460 for the correct MU number.

Background

Some changes of circumstances will result in a complex case (including cross-border and family supplement cases) becoming non-complex, for example

  • death of a spouse in a polygamous or polyandrous marriage
  • family break-up in a polygamous or polyandrous marriage
    Note: This instruction applies even if there are more than two customers remaining in the family.
  • a child or young person in a family of 19 children is no longer eligible for Child Tax Credit (CTC)
    Note: 6 April 2014 there will be a change to Full time non advanced education (FTNAE) where an end date of 31/08/CY will be applied on NTC. This change applies to 18 and 19 year olds. The customer will have to inform us each year whether the qualifying young person is continuing in FTNAE. Where the customer does not inform Tax Credits, the CTC will end. This must be considered in all manual calculations.
  • income-related Employment and Support Allowance (ESA) ending for a tax credits customer receiving Working Tax Credit (WTC)
  • a tax credits customer receiving income-related ESA who becomes ineligible for WTC
    Note: From 1 May 2012 the period for which people can receive contribution-based ESA will be limited to 12 months.
  • a customer subject to immigration control (STIC) in a joint claim becomes responsible for a child, resulting in entitlement to both WTC and CTC
  • a customer in a joint claim is no longer subject to immigration control, resulting in entitlement to the 2nd adult element of WTC
  • a customer (in a childless two-customer family) serving a custodial sentence of more than 12 months being released from prison
  • a change in residency or employment involving movement between Member States of the European Union (EU) has resulted in the United Kingdom (UK) becoming competent to pay CTC at the full rate, without offset.

Note: Consider supplement up to the end of the month in which the change of circumstances occurred.

As the Complex Case signal is set, the change of circumstance will be referred to the International Complex / UK Complex Team (This content has been withheld because of exemptions in the Freedom of Information Act 2000) . Use TCM0322460 for the correct MU number.

Because it is not possible to lift the Complex Case signal, the team will

  • end the family on the complex claim
  • capture as a new claim from the day after the family has been ‘ended’.
    Note: from 1 January 2019, where a claim does not contain an individual who is of Pension Credit Qualifying Age (PCQA) or more than two children, the Geographical Step Closure (GSC) override checkbox will need to be ticked. Unless the override is applied the claim will be rejected. For how to do this, use TCM1000629.

In the case of the death of a spouse or a family break-up in a polygamous or polyandrous marriage, it will be necessary to check whether exceptions to business rules apply. For how to do this, use TCM1000628.

If appropriate, you should then invite the customer(s) to make a fresh claim. For all other changes listed, it will not be necessary for the customer to make a fresh claim.

Note: to support the expansion of Universal Credit (UC), The Department for Work and Pensions (DWP) and the Department for Communities (DfC) in Northern Ireland, are undertaking a phased rollout approach using postcodes. By 31 December 2018, this rollout will be complete and any new claims for Tax Credits will no longer be accepted after this date and HMRC will signpost the customer(s) towards DWP or DfC to claim Universal Credit instead.

The only exception to this is if the customer (or in the case of a joint claim, one of the customers) is recognised as being of Pension Credit Qualifying Age (PCQA) or they have more than 2 children. Business rules will allow these exceptions to be identified and Tax Credit claims can be accepted on this basis. Full Gateway Closure will take place on 31 January 2019 and, after this date, these excpetions will no longer be accepted.

Note: From 16 January 2019, an additional exception will be accepted where the customer is in receipt of the Severe Disability Premium (SDP) as part of their legacy benefit.

Severe Disability Premium (SDP) is an extra amount of money that is included in Income Support, income-based Jobseeker’s Allowance, income-related Employment and Support Allowance and housing benefit where a customer meets the entitlement conditions.

To be eligible for SDP, a customer must be in receipt of one of the following qualifying benefits:

  • PIP daily living component
  • Armed forces independence payment (AFIP)
  • DLA care component at the middle or highest rate
  • Attendance Allowance, or Constant Attendance Allowance paid with Industrial Injuries Disablement Benefit

SDP is only payable where a customer lives alone or is treated as living alone. A customer cannot get the severe disability premium if someone is in receipt of Carer’s Allowance or the carer element of Universal Credit for looking after them.

Once the manual renewal action is complete, the Manual Correspondence signal will be lifted and the claim will be fully managed through the computer.

If all complex involvement has ended and the case no longer needs to be paid manually, you will need to recapture the claim on NTC so it can now be paid on system. To deal with claims where a change of circumstance results in a complex case becoming non-complex, consider steps 1 to 13.

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 / Data Security Team for advice.

Note: From 6 April 2017, customers will only get the Family Element of Child Tax Credit where they are responsible for a child or children born before that date.

Note: The individual child element of Child Tax Credit will no longer be awarded for third and subsequent children or qualifying young persons in a household, born on or after 6 April 2017, unless it meets the exception criteria.

Note: All children/qualifying young persons should be added to the award. Customers will still receive the childcare and/or disability element for all children/qualifying young persons if they are entitled, even if they are not in receipt of the child element.

Note: If you are dealing with a claim where the customer states they are claiming for a child/young person who is an exception contact the Exception Team (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)

Note: If you are dealing with a claim where the exception marker has been applied to any of the children/young persons included in the claim contact the Exception Team (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) For how to check if the exception marker has been applied, use TCM1000314.

Step 1

Check for any Compliance activity on the claim. Follow the guidance in TCM0134440, then if referred back to this guidance, go to Step 2.

Step 2

Use Function ‘VIEW APPLICATION’ to view all the screens for the latest version of the claim to check what information has been captured.

Check the payments stencil to see whether the payments the customer has received when the claim should have been non-complex, have already been paid under the complex claim.

Note: If it appears the customer may have been underpaid or overpaid as the change was not applied in time, the complex claim will need to be recalculated. Use the SEES calculator to complete a manual calculation.

If any of the following circumstances apply

  • there are now 18 or fewer children in the family
    Note: If there are now 18 or fewer children in the family because one of the children has died, contact the Business Helpdesk through your Technical Advice Line Liaison Officer for further guidance before you go to Step 3.
  • the customer has been released from prison
  • income-related ESA has ended for a tax credits customer who is also receiving WTC
  • WTC eligibility has ended for a tax credits customer who is also receiving income-related ESA
  • in a STIC the customer’s immigration status has changed
  • in a STIC case a child is added to the claim.

Take a screen print of each screen, go to Step 3.

If the UK is now competent to pay family benefits

  • locate the most recent manual calculation from the case papers held in manual bf
  • take a screen print of each screen
  • go to Step 4.

If one of the customers in a polygamous or polyandrous marriage has died, go to Step 4.

If there has been a family break-up in a polygamous or polyandrous marriage, go to Step 4.

Step 3

Use the SEES Tax Credit Entitlement Calculator to calculate the revised award of tax credits

  • enter details (taken from the screen prints) of the customer’s entitlement from the effective date of the claim. Follow the guidance in the SEES Menu System Help
  • include the change of circumstance from the effective date of the change
  • take a screen print of the calculation
  • go to Step 4.

Step 4

Check the manual payment form filed in the casepapers

  • note the ‘Paid up to date’ recorded on the form
  • do not make any further manual payments to the customer.
    Note: Consider payment of arrears where a switch in competency is due to employment.

If the change of circumstance is due to

  • death of a customer in a polygamous or polyandrous marriage case, go to Step 5
  • a family break-up in a polygamous or polyandrous marriage case, follow the guidance in TCM0036100 then, go to Step 11
  • a cross-border or family supplement case, go to Step 6
  • a switch in competency, go to Step 8.

If there are any other change of circumstances, go to Step 8.

Step 5

Complete a Priority One Change Of Circumstance stencil and send it to the P1 Team.

Use Function ‘MAINTAIN HOUSEHOLD NOTE’

  • enter the following message in the Additional Information field. ‘TCMZ Complex Case - P1 Team only required to notify CBO. International Complex / UK Complex Team will take all other action’. Use TCM0322460 for the correct MU number
  • go to Step 13.
    Note: Because you have entered details of a family breakdown, an incorrect automated notice will be produced. As the Manual Correspondence signal is set, you will receive this notice from the team working the Manual Correspondence work list.

Step 6

Calculate the total amount of CTC that has been offset during the period of the award up to the date the UK became competent to pay full family benefits. The weekly amount of the offset will be recorded on the manual payments calculation sheet filed in the casepapers

  • make a note of the offset on form TC648
  • go to Step 7.

Step 7

Use Function ‘MAINTAIN HOUSEHOLD NOTES’ to apply the appropriate household note to the claim, go to Step 8.

Note: You must follow the guidance in TCM0152060 when you record the note and also follow the guidance in TCM0152160.

Step 8

Use Function ‘AMEND APPLICATION’

  • select the ‘Change of Circumstances’ option
  • go to the ‘Household Details’ screen
  • enter the family end date in the ‘Household End Date’ field (use the effective date of the change of circumstances as the family end date)
  • select ‘Household Breakdown’ from the ‘Household End Reason’ drop down menu
  • select ‘OK’, you will be taken to the ‘Amend Finish’ screen
  • enter the appropriate household note. For how to do this, use TCM1000001
  • enter the date the notification of the change was received
  • enter the source of the change (Paper)
  • enter the reason for the change (designatory changes)
  • select ‘OK’
    Note: The changes you have made in this function will not be applied until you complete the ‘Amend Finish’ screen and select ‘OK’.
    Note: The ‘Received Date’ field will always default to today’s date. You must enter the date the change of circumstances was notified, not the date the change is actioned. If there is more than one notification date then the earliest notification date must be entered.
    Note: If there is more than one source of change, you must enter the original source that started the process, for example, if you are processing a paper correspondence change of circumstances and a worklist item and the paper correspondence stamp date is earlier.
  • go to Step 9.

Step 9

If the message ‘S18 Refinalisation Rules - Potential inappropriate refinalisation for CCYY-CCYY. If you have the authority to re-finalise under S19, S20 or S21 of the Tax Credit Act 2002 or due to an appeal decision. Press ‘OK to process the change or Cancel’ displays the changes you are making will re-finalise the claim

  • select ‘OK’ on the message
  • go to Step 10.

If the message ‘S18 Refinalisation Rules - Actual Income for CCYY-CCYY is required. This change will not be accepted’ displays you will not be able to make the change because the PY actual income is required

  • select ‘OK’ on the message
  • go to Step 10.

If the message ‘S18 Refinalisation Rules - You do not have the authority to re-finalise CCYY-CCYY. This change will not be accepted. Please refer to the appropriate team’ displays the changes you are making will re-finalise the claim

  • select ‘Cancel’

You will be taken to the ‘Amend Application Details’ screen

  • select ‘Cancel’

the message ‘All changes to the application will be lost for this session, do you wish to proceed?’ will display

  • select ‘Yes’
  • pass the case to a Level 2 User or your manager. For more information, use ‘Level 1 and Level 2 users’ on TCM0320260
  • take no further action.

If none of the messages display, go to Step 10.

Step 10

Use Function ‘CAPTURE APPLICATION’ to capture a new claim. Follow the guidance in TCM0062120, enter the claim details from the screen prints.

Note: Remember to capture only the appropriate change of circumstances. If a child has left the family, this child will be omitted from the claim.

In the ‘Summary Information’ screen

  • enter the Effective Date as one day after the family end date you have entered on the ‘Household Details’ screen in the complex claim
  • enter the employment details as one day after the family end date you have entered on the ‘Household Details’ screen in the complex claim
  • enter the Received Date as two days after the family end date you have entered in the ‘Household Details’ screen in the complex claim
  • add appropriate household note. For how to do this, use TCM1000001
    Note: This will prevent automatic backdating of the claim that would result in an overpayment.
  • select ‘OK’

Note: Geographical Step Closure (GSC) business rules will recognise if you are trying to capture a claim where exceptions do not apply.

You will be presented with a warning message stating that: ‘The Information captured is for a closed postcode. Application will be rejected unless overridden’.

Note: from 1 February 2019, the GSC override checkbox will need to be ticked in order to accept the claim. Unless the override is applied the claim will be rejected. For how to do this, use TCM1000629.

If you are trying to capture a claim and exceptions to business rules do not apply

If you are trying to capture a claim and exceptions to business rules apply

  • select ‘Process’
  • go to Step 11.

Step 11

Because the manual correspondence signal is set, the entries on the Manual Correspondence work list will be transferred to your MU.

If you are dealing with a family break-up in a polygamous or polyandrous marriage

  • manually issue the notice relating to the family break-up
  • go to Step 13.

If you are dealing with any other change of circumstances, go toStep 12.

If the claim was a cross-border case or family supplement case

  • notify the customer on the appropriate TC602 how much has been deducted from the award of CTC because of family benefits paid by the EU Member State
  • go to Step 12.

Step 12

Use Function ‘MAINTAIN WORKLISTS’ to clear the entry / entries on the Manual Correspondence work list

  • select ‘Manual Correspondence’ work list from the drop down menu for the work list type field
  • select the office or unit you want from the drop down list for the Management Unit (MU) field, the screen will redisplay with the entries currently on the work list
    Note: The office or unit you want may already be displayed.
  • select the work item you want to work
  • select ‘Delete’
  • go to Step 13.

Step 13

The case is now non-complex

  • refer the case papers to Renewals
  • issue the appropriate TC602 to both customers
  • take no further action.