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HMRC internal manual

Tax Credits Manual

From
HM Revenue & Customs
Updated
, see all updates

Specialist areas - complex: complex cases - manual renewal (AG)

To deal with manual renewal for complex cases, consider steps 1 to 37.

Step 1

Before you process the claim you are currently working on, follow the guidance in TCM0138020 

then, if you can process the claim

  • use Function MAINTAIN WORKLISTS
  • select the Manual Correspondence work list from the drop down list for the Work List Type field
  • select the office or unit you want from the drop down list for the Management Unit (MU) field (if the one you want is not already displayed in this field). The screen will be redisplayed with the entries currently on the work list
  • go to .

Step 2

Select the entry in the work list you want to work and select Details]. You’ll be taken to the Work List Entry Details screen where more details of the selected work item will be displayed.

Step 3

Locate the automated S17 Notices (forms TC603R and TC603D) and covering form TC648 for the work item you have selected. These will have been forwarded to you by the Manual Correspondence Team.

If you

  • are not able to locate the automated S17 Notices, go to .
  • are able to locate the automated S17 Notices, go to .

Step 4

Use Function VIEW S17 DETAILS and go to the Issue Details screen to establish the 1st Specified Date (1SD).

Note: When using Function VIEW S17 DETAILS, ensure that you select the correct tax year.

If the 1SD is

  • more than 35 days from today’s date, go to .
  • within 35 days of today’s date

    • use Function MAINTAIN FINALISATION and go to the Notice Details screen to extend the 1SD by 30 days from the issue date of the automated S17 Notices. Follow the guidance in TCM0264060 
    • go to .

Step 5

Use Function MAINTAIN WORKLISTS to

  • set an action date in the Manual Correspondence work list for a further five days from today’s date. Make sure the Retained checkbox is ticked. Follow the guidance in TCM0140020 
  • when the new action date expires, try to locate the automated S17 Notices. If you

    • are not able to locate the automated S17 Notices, go to .
    • are able to locate the automated S17 Notices, go to .

Step 6

If you still are not able to locate the automated S17 Notices

  • request a copy of both the TC603R and TC603D. Follow the guidance in TCM0184150 
  • use Function MAINTAIN HOUSEHOLD NOTES and select the Renewals & Reminders category and enter the following message

‘TCMZ Copy of S17 Notices requested’

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

  • take no further action.

Step 7

As the automated form TC603R has room for only seven children, use Function VIEW APPLICATION and go to the Children screen. If

  • there are not any children missing from the automated form TC603R, go to .
  • one or more child is missing from the automated form TC603R

    • take a screen print
    • go to .

Step 8

Use Function VIEW HOUSEHOLD NOTES and select all relevant notes to establish what information is missing or incorrect on the automated form TC603R - for example, details of children and/or customers who couldn’t be captured on the ‘Applicant Details’ or ‘Children’ screens

  • make a note on form TC648 of the missing or incorrect information

    • If the claim is a cross-border or overseas family supplement case, go to .
    • If the claim is any other complex case, go to .

Step 9

If the claim is a cross-border or overseas family supplement case, you will require additional information about benefits the customer’s family has received from the Other Member State (OMS) in order to finalise the previous year (PY) award and renew the current year (CY) award

  • complete form TC828
  • go to .

Step 10

If

  • all members of the family are correctly recorded on the automated form TC603R

    • send the automated forms TC603R and TC603D to the customer’s (or appointee’s) address by 2nd Class post.
  • the claim is a cross-border or overseas family supplement case

    • include form TC828 with the automated forms TC603R and TC603D
    • use 2nd Class post if the address is in the United Kingdom (UK) and 1st Class airmail (weighed at International rate) if the address is outside the UK.
  • a child or young person is not recorded on the automated form TC603R

    • complete a manual version of form TC603R including the missing child or young person
    • send to the customer’s (or appointee’s) address with the automated form TC603D by 1st or 2nd Class post as appropriate.
  • any of the customers are not recorded on the automated form TC603R

    • complete a manual version of forms TC603R and TC603D as both the automated forms will be incorrect
    • send to the customer’s (or appointee’s) address by 1st or 2nd Class post as appropriate.

Note: All customers in a polygamous or polyandrous marriage will be required to give information about their benefits and income in order to finalise the PY and renew the CY award. A declaration must be sent with the S17 Notices for each of the customers in a polygamous or polyandrous marriage to give each the opportunity to sign.

Note: All customers must be given a minimum of 35 days in which to return their Annual Declaration (form TC603D). If there is less than 35 days between the date of issue and the 1st Specified Date (1SD), you must amend the 1SD on the TC603R to allow 35 days.

Step 11

In all cases, if a date of death has been recorded for any of the children included on theTC603R

  • issue a covering letter TC830 with the forms TC603R and TC603D.
  • go to .

Step 12

Use Function MANAGE FINALISATION and record the date of issue of the S17 Notices.

  • enter the date of issue in the ‘S17 Notice’ section in the centre of the window. The computer will automatically calculate and set the 1SD and 2SD.

Step 13

Use Function MAINTAIN WORKLISTS to clear the entry on the Manual Correspondence work list

  • select the Manual Correspondence work list from the drop down list for the Worklist type field
  • select the office or unit you want from the drop down list for the MU field if the one you want is not already displayed in this field. The screen will be redisplayed with the entries currently on the work list
  • select the entry in the work list that you wish to delete
  • select [Delete].

Note: Repeat this process each time you need to delete an entry on the Manual Correspondence work list.

Step 14

Use Function MAINTAIN HOUSEHOLD NOTES and record the forms you have issued and the date

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

  • If the Annual Declaration (and/or form TC828 in a cross-border or overseas family supplement case) has not been returned within 28 days of the 1SD, go to .
  • If the Annual Declaration is returned (together with form TC828 if a cross-border or overseas family supplement case) within 28 days of the 1SD, go to .

Step 15

If the Annual Declaration has not been returned within 28 days of the 1SD, an automated reminder will be produced and a further entry will be created on the Manual Correspondence work list. Wait until you receive the automated reminder, then

  • issue the reminder manually to the customer’s (or appointee’s) address as appropriate. Follow the guidance in TCM0254120 
  • use Function MAINTAIN HOUSEHOLD NOTES to record the action you have taken and the date

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

  • use Function MAINTAIN WORKLISTS and delete the entry from the Manual Correspondence work list

    • If the Annual Declaration (and form TC828, if a cross-border or overseas family supplement case) is received by the 1SD, go to .
    • If the Annual Declaration (and form TC828, if a cross-border or overseas family supplement case) is not received by the 1SD, go to .

Note: In a cross-border or overseas family supplement case, both the Annual Declaration and the form TC828 must be received before the Annual Declaration can be captured. If one form is received without the other, a manual reminder must be issued for the missing form.

(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) TCM0264060(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Step 16

Use Function MAINTAIN PAYMENT SUSPENSION and check that the payment suspension is still set in the Maintain Payment Suspension screen

  • If the payment suspension is still set, go to .
  • If the payment suspension is not still set, set the payment suspension

    • select ‘Manual Payment Request’ from the options available
    • select [Add]. This sets the payment suspension

Note: If there are two customers captured on the computer, the payment suspension must be set for both.

* select [OK]
* use Function MAINTAIN HOUSEHOLD NOTES and enter one of the following messages if the appropriate one is not already displaying - ‘TCMZ Complex Case’ or ‘TCMZ Cross Border Family Supplement Case’

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

* go to .

Note: If it is an NTC Listing case, go to .

Step 17

When the Annual Declaration is received and has been completed in respect of all customers (and accompanied by form TC828 if a cross-border or overseas family supplement case), capture the details on the computer to prevent automatic termination of the claim.

  • If the customer has not indicated a change because both Statement of Changes boxes have been left blank on the Annual Declaration, accept there are no changes to report. Treat the response as if the ‘No’ box had been completed.
  • If the customer has indicated on the Annual Declaration that there has been a change of circumstances but has not given details of the change

    • contact the customer to obtain the missing information before capturing the Annual Declaration. Follow the guidance in TCM0094080 
    • keep in view that you may need to extend the 1SD if you are expecting the customer to make a late reply. Follow the guidance in TCM0264060.
  • If the Annual Declaration is in respect of customers in a polygamous or polyandrous marriage, it is not necessary to obtain a signature from each customer. You can accept the Annual Declaration providing that at least one customer has signed it.
  • If there are more than two customers and/or more than 18 children included in the family

    • capture as much information as possible on the computer
    • use Function MAINTAIN HOUSEHOLD NOTES to check that details of the additional family members are correctly recorded there

then, in all cases

Step 18

When the Annual Declaration is received, use Function AMEND APPLICATION, choosing the Correction option to capture the details to prevent automatic termination of the claim.

Note: The Annual Declaration must be completed in respect of all customers and, if the case is a cross-border or overseas family supplement case, must be accompanied by form TC828.

Note: If the Annual Declaration is in respect of customers in a polygamous or polyandrous marriage it is not necessary to obtain a signature from each customer. You can accept the Annual Declaration providing that at least one customer has signed.

  • If the customer has indicated on the Annual Declaration that there has been a change of circumstances but has not given details of the change, contact the customer to obtain the missing information before capturing the Annual Declaration. Follow the guidance in TCM0094080.

    • If you are able to obtain the missing information

    • capture the information regarding the change of circumstances
    • capture the details on the Annual Declaration
    • go to .

    • If you are not able to obtain the missing information

    • capture as much information as possible regarding the change of circumstances
    • capture the details on the Annual Declaration
    • go to .
  • If there are more than two customers and/or more than 18 children included in the family

    • capture as much information as possible from the Annual Declaration
    • use Function MAINTAIN HOUSEHOLD NOTES to check that the details of the additional family members are correctly recorded there
    • go to .

Step 19

Note: If you are dealing with an NTC Listing case, you must recalculate the PY-1 award.

Check the income figures that the customer has provided on the Annual Declaration (and form TC828 if the claim is a cross-border or overseas family supplement case).

Notes:

  • From 2006/2007 the income increase disregard increased to £25,000
  • From 6 April 2011 the income increase disregard decreased to £10,000
  • From April 2013  the income increase disregard will decrease to £5,000
  • From 6 April 2016 the income increase disregard will decrease to £2,500 
  •  

If the customer has reported any decrease in income or an increase in income of more than £25,000

* use the SEES Tax Credit Entitlement Calculator and recalculate the customer’s PY entitlement
* take two prints of the revised calculation (one to be placed in the casepapers and one to be passed to your line manager for statistical purposes
* go to .

Note: Disregard the first £25,000 of any increase in income and base the recalculation only on the amount that exceeds £25,000.

Note: If the customer provides an estimate of income, you must base your recalculation on the estimate but you may need to do a further recalculation if they subsequently provide actual income. Follow the guidance in TCM0118180. If the customer fails to provide actual income an automated reminder will be produced approximately six weeks before the 2SD and you must manually issue this to the customer. If the customer does not provide actual income, the computer will finalise the PY award on the estimated income and you will not need to do a further recalculation.

Note: In the case of a cross-border or overseas family supplement claim, family benefits received from an OMS should not be included as income.

Step 20

Use Function VIEW HOUSEHOLD ACCOUNT to check if any additional payments have been posted on the computer

  • enter the customer’s details in the Key Entry Data screen
  • select the All checkbox and the Postings checkbox. This will take you to the Select Award screen
  • ‘double click’ on the PY award period. This will take you to the Postings screen for the relevant award period
  • check the manual payments recorded on the payments proforma against the payments posted on the Postings screen
  • record details of any overpayment or underpayment for PY on form TC648

    • If the claim is a cross-border or overseas family supplement case, go to .
    • For all other claims, go to .

Step 21

If the claim is a cross-border or overseas family supplement case

  • check the calculation of the Child Tax Credit (CTC) supplement with the figures the customer has provided on form TC828
  • recalculate the CTC supplement if the customer has reported any change in the amount of family benefits paid by the OMS
  • compare the amount of CTC supplement that has been paid to the customer with the manually calculated award
  • record the details of any overpayment or underpayment of CTC supplement on form TC648
  • go to .

Note: You must consider any increase or decrease in family benefits paid by the OMS when recalculating the PY CTC supplement.

Step 22

Note: If you are dealing with an NTC Listing case, you must recalculate the PY award.

Use the SEES Tax Credit Entitlement Calculator

  • enter all the details that the customer has provided on the Annual Declaration to calculate the entitlement for CY
  • do not disregard any increase in income

Note: If the claim is a cross-border or Overseas Family Supplement Case, consider whether other benefits that the customer has recorded on form TC828 should be included as income but do not include family benefits.

  • take two prints of the calculation (one to be placed in the casepapers and one to be passed to your manager for statistical purposes)
  • go to .

Note: If it is an NTC Listings case, go to .

Note: Check whether there are any known future changes of circumstance when you calculate the CY award as you must take these into account - for example, if a child under the age of one reaches its first birthday during the award period.

Step 23

As the complex case signal is set, an entry will be created on the Unprocessed S17 work list when you capture the Annual Declaration

  • use Function MAINTAIN WORKLISTS and select the Unprocessed S17 work list from the drop down menu. All the entries for the Unprocessed S17 work list will be displayed for your MU

then

  • If the complex case signal is not the only reason for the work list entry

    • follow the guidance in TCM0272020 to clear all the other entries until only the complex case signal entry remains
    • use Function MANAGE FINALISATION
    • select [Process]. This will display the Process screen
    • complete the Actioned By field selecting TCO from the drop down menu
  • If there is entitlement for CY

    • select Finalise and Renew, using the reason ‘Full Reply’
    • select [Finalise and Renew]
  • If there is no entitlement for CY

    • select Finalise, using the reason ‘Full Reply’
    • select [Finalise]. This action will remove the entry from the Unprocessed S17 work list if the complex case signal is the only reason for the entry

then, in all cases

  • go to .

Step 24

Use Function NTC LISTING to identify the work item you are dealing with. To do this

  • go to the NTC Listing screen
  • select ‘Unprocessed S17’ from the Listing Type drop down menu
  • select the number that corresponds to the initial letter of the name you require from the Selection drop down menu - for example, select 14 for names beginning with the letter ‘N’. A full list of the selected items will display
  • select [Sort Filter]. The Sort and Filter Worklist Entries screen will display
  • filter the entries with the reason of ‘Reference’, entering the NINO you made a clerical note of in the From Value and To Value fields
  • select [OK]. You will be taken to the NTC Listing screen, which will display the work item you are actioning
  • select the work item
  • select [Details]. The Listing Entry Details screen will display
  • If the Complex Case signal is not the only reason for the work list entry, follow the guidance in TCM0196000 to clear all the other entries until only the Complex Case signal entry remains

Note: When following the guidance to clear the other entries do not finalise and renew the award. Instead, return to this step.

  • go to .

Step 25

Use Function MANAGE FINALISATION

  • enter the customer’s NINO in the Key Entry Data screen
  • select the All checkbox
  • select [OK]. You will be taken to the Select Tax Credit Period screen
  • select the PY-1 claim that you are dealing with
  • select [OK]. You will be taken to the Manage Finalisation screen
  • select [Process]. You will be taken to the Process screen
  • select ‘TCO’ from the Action Authority drop down menu
  • select ‘As Agreed’ from the Renew drop down menu
  • select [Renew]

Note: If an error message displays, select [OK] or [Yes], as appropriate and continue with your action.

* If the [Renew] button is not available, go to .
* If the [Renew] button is available, BF the case for three days and then go to .

Step 26

Use Function MANAGE FINALISATION

  • enter the customer’s NINO in the Key Entry Data screen
  • select the All checkbox
  • select [OK]. You will be taken to the Select Tax Credit Period screen
  • select the PY-1 claim that you are dealing with
  • select [OK]. You will be taken to the Manage Finalisation screen
  • select [Process]. You will be taken to the Process screen
  • select ‘TCO’ from the Action Authority drop down menu
  • select ‘As Agreed’ from the Finalise drop down menu
  • select [Finalise]

Note: If an error message displays, select [OK] or [Yes], as appropriate and continue with your action.

* If the [Finalise] button is not available, go to .
* If the [Finalise] button is available, BF for three days to ensure the award is finalised and then go to .

Step 27

Use Function VIEW HOUSEHOLD ACCOUNT to check if the PY-1 award has been finalised. To do this

  • enter the customer’s NINO in the Key Entry Data screen
  • select the All checkbox
  • select [OK]. You will be taken to the Select Award screen
  • select the PY-1 award that you are dealing with
  • select [OK]. You will be taken to the ‘Award Summary’ screen
  • check the Award Status field. If the award status

    • is shown as ‘Finalised’, go to .
    • Is not shown as ‘Finalised’, BF for three days and then return to this step.

Note: If the case still is not finalised after a second BF of three days, refer to your TALLO (Technical Advice Line Liaison Officer).

Step 28

Use Function NTC LISTING to identify the work item you have just actioned. To do this

  • go to the NTC Listing screen
  • select ‘Unprocessed S17’ from the Listing Type drop down menu
  • select the number that corresponds to the initial letter of the name you require from the Selection drop down menu - for example, select 14 for names beginning with the letter ‘N’. A full list of the selected items will display
  • select [Sort Filter]. The Sort and Filter Worklist Entries screen will display
  • filter the entries with the reason of ‘Reference’, entering the NINO you made a clerical note of in the From Value and To Value fields
  • select [OK]. You will be taken to the NTC Listing screen which will display the work item you have just actioned
  • select the work item
  • select [Delete]
  • when the message ‘Listing entry will be permanently deleted’ displays, select [OK]. The work item will be deleted from NTC Listing
  • go to .

Step 29

Note: If you are dealing with an NTC Listing case, you must recalculate the PY award.

The payment profile for the CY award must be correctly calculated. Follow the guidance in TCM0284280 

Note: If the claim is a cross-border or Overseas Family Supplement Case, calculate the supplement of CTC for CY.

  • offset all provisional payments made since the start of the tax year against the new CY award
  • make a one-off payment to the customer if there has been an underpayment on the PY award
  • apply the appropriate percentage to recover from the CY award any overpayment on the PY award
  • go to .

Step 30

Note: If you are dealing with an NTC Listing case, you must finalise the PY-1 award and renew the PY award.

Await the automated award notices after finalising the PY award as these may be used as a guide when creating the manual award notices. The type of award notices you will need to create will depend on the action you have taken.

For example: amend the incorrect details on the automated award notice depending on the circumstances of the claim if you have finalised the PY award or renewed the CY award. For instance, if

  • there are more than two customers in the family you must include details of the missing customers
  • the claim is a cross-border or overseas family supplement case, you must adjust the amount of CTC payable to take account of the family benefits paid by the OMS

    • If you are completing a finalised award notice for PY (a FAN), enter the following messages

    • at chunk 2 of the notice (heading ‘Please read this’)

‘You received benefits from another European Economic Area country totalling £XXXXX.XX for the year from 06/04/YY to 05/04/YY. This amount has been taken off your award of Child Tax Credit reducing it to £XXXXX.XX’

* at chunk 8 of the notice (heading ‘Child Tax Credit’)

‘Amount we have deducted because you received family benefits from another European Economic Area country is £XXXXX.XX’

* If you are completing a renewal award notice for CY (a CYAN), enter the following messages

* at chunk 2 of the notice (heading ‘Please read this’)

‘You are receiving benefits from another European Economic Area country expected to total £XXXXX.XX for the year from 06/04/YY to 05/04/YY. This amount will be taken off your award of Child Tax Credit reducing it to £XXXXX.XX. If your circumstances change please tell us’

* at chunk 8 of the notice (heading ‘Child Tax Credit’)

‘Amount we have deducted because you are receiving family benefits from another European Economic Area country is £XXXXX.XX’

  • then, in both instances, send the award notices by

    • 2nd Class mail if the address is in the UK
    • 1st Class airmail (weighed at International rate) if the address is outside the UK

then

  • go to .

Step 31

If the customer does not return the Annual Declaration by the 1SD, the computer will automatically finalise the PY award and terminate the CY award.

Do not make any further provisional payments of WTC and/or CTC after the 1SD

  • calculate the total amount of provisional payments recorded on the Provisional Payments Form Appendix 1
  • use Function VIEW HOUSEHOLD ACCOUNT to check if any additional payments have been posted on the computer

    • enter the customer’s details in the Key Entry Data screen
    • select the All checkbox and the Postings checkbox. This will take you to the Select Award screen
    • ‘double click’ on the Provisional Award period. This will take you to the Postings screen for the relevant award period
    • check the manual provisional payments you have made against the payments posted on the Postings screen
    • if additional payments have been posted, add them to the provisional payments you have made and record the total payment on form TC648
  • check the payment and accounting records held for PY to determine if there is any known underpayment or overpayment on the PY award
  • compare the amounts you have manually paid with the amount awarded in the original PY manual calculation
  • use Function VIEW HOUSEHOLD ACCOUNT to check the Postings screen for the PY award period for any additional payments posted on the computer
  • make a note of any under or overpayment on the PY award on form TC648
  • go to .

Step 32

If the award has been terminated because the customer has failed to complete the Annual Declaration, wait for the automated finalised award notice as this may be used as a guide when you create the manual version

  • complete a manual statement of account (form TC607(MAN) to notify the customer that the CY award has been terminated and that action will be taken to recover the provisional payments you have made and any known overpayment on the PY award
  • create a manual finalised award notice for the PY award
  • send both notices by 2nd Class mail if the address is in the UK and by 1st Class airmail (weighed at International rate) if the address is outside the UK

Note: If there has been an underpayment on the PY award, make a one-off payment to the customer as any underpayment on the PY award cannot be offset against the overpayment on the provisional award.

  • go to .

Step 33

Use Function MANAGE FINALISATION to record the issue date of the finalised manual award notice in the relevant box in the Notice Details screen.

Step 34

As a further entry will have been created on the Manual Correspondence work list, use Function MAINTAIN WORKLISTS

  • delete the entry on the Manual Correspondence work list
  • go to .

Step 35

Note: If you are dealing with an NTC Listing case, you must finalise the PY-1 award and renew the PY award.

Use Function MAINTAIN HOUSEHOLD NOTES and enter the following information as appropriate. In all cases, enter the relevant year that the information covers

  • the issue date of the award notice (and statement of account)
  • the amount of the revised PY award including details of any under or overpayment (and details of the one-off payment if an underpayment)
  • the amount of the CY award including the amount of provisional payments to be offset and the rate of recovery of any overpayment.
  • (If the claim is a cross-border or overseas family supplement case) the amount of CTC supplement and details of the OMS competent to pay family benefits and the amount of any benefits in payment from the OMS
  • (If you have issued a statement of account) the amount of tax credits to be recovered

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

then, when you have updated Household Notes

  • If the claim is a cross-border or overseas family supplement case, go to .
  • If the claim is not a cross-border or overseas family supplement case, go to .

Step 36

Complete form TC694 to notify the OMS about the new award of CTC for CY or that there is no longer any entitlement to CTC.

(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)  

The address of the European Economic Area (EEA) authority for other countries will be provided by the customer on form TC828.

Note: You must not divulge information to the OMS about any award of Working Tax Credit (WTC) as WTC is not a family benefit.

  • go to .

Step 37

Complete form TC694 to notify Child Benefit Office (CBO) about the customer’s new award of CTC and the amount of CTC supplement you are going to pay for CY (or if there is no longer any entitlement to CTC)

  • send form TC694 to the relevant CBO International Group 1 EC section. Follow the guidance in TCM0304150 
  • go to .

Step 38

Note: If you are dealing with an NTC Listing case, you must recalculate the PY-1 award.

The manual renewal has now been processed.

  • If the customer has entitlement to tax credits for CY, you must continue to make manual payments of WTC and CTC at the normal pay frequency until further instructions are issued to manage payment through the computer.
  • If the CY award has been terminated because the customer has failed to return a properly completed Annual Declaration or because the customer has not any entitlement to tax credits in CY, continue to hold the casepapers until instructions are issued to send the customer a notice to pay.