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HMRC internal manual

Tax Credits Manual

Specialist areas - Persons from abroad: Persons From Abroad team - Refugee backdating

Checklist

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

Background

A customer has claimed asylum as a refugee and has been excluded from tax credits as a person subject to immigration control. The customer is then notified they have been recorded as a refugee by the Home Office and they must apply for tax credits within 30 days of receiving their notification of refugee status from the Home Office.

The customer will be treated as having made a claim for tax credits for the whole of the period from the date of the original claim for asylum up to the date the actual claim for tax credits is made. This includes any intervening years.

Entitlement is determined as if the person had been a refugee from the date the claim to asylum was made. This means they should be treated as a person who is not subject to immigration control from the date they claimed asylum.

The rules for couples will also apply from that date. Before April 2010, neither partner would be subject to immigration control and eligible to receive the 2nd adult element of Working Tax Credit (WTC).

After April 2010, where one customer has refugee status and their partner is subject to immigration control, we consider whether the second adult element is to be removed.

The amount of any tax credits due is reduced by the amount of any support already provided under Section 95 or 98 of the Immigration and Asylum Act 1999.

Note: This does not cover payments made under Section 4 of the Immigration and Asylum Act 1999 or Integration Loans made under Section 13.

Note: From 14/7/07 Integration Loans have replaced National Asulym Seeker Support (NASS) payments as the main form of support for asylum seekers. Where Integration Loans are received by the customer, they are not considered in assessing tax credits entitlement. The United Kingdom Border Agency (UKBA) may still make payments under Section 95 or 98. Where such payments are made, the amount of support provided is still to be deducted from any award of tax credits made to the customer. Any customer that claimed asylum before 14/07/07 will not be eligible for Integration Loans but should still be eligible for NASS payments.

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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: Where you are dealing with a claim where an exception marker has been applied to any of the children/young persons included in the claim or the customer is reporting a change relating to an exception contact the Exception Team (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

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Step 1

If the claim is pre award and you have been signposted to this guidance from TCM0290150, go to Step 7.

If the claim is post award and you are dealing with a retrospective backdating request, go to Step 2.

If you are dealing with an expired BF for a TC1125 or TCPFA, go to Step 4.

If you are dealing with a reply from the Compliance Directions Research Team, go to Step 7.

If you are dealing with a returned TCPFA, go to Step 10.

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Step 2

Check the Household Notes for any indication that backdating has already been considered.

If this is the first time you are considering backdating

  • complete form DCI100
  • send to inbox (This content has been withheld because of exemptions in the Freedom of Information Act 2000)
  • check the Home Office Computer System (HOCS) to establish the customer’s refugee status
    Note: Customers who have entered the UK under the Syrian Resettlement Programme are required to meet the same criteria as an asylum seeker.
  • go to Step 3.

If backdating has already been considered

  • update Household Notes with the message IP39 from TCM0160040. For how to do this, use TCM1000001
  • send any relevant correspondence to storage. For how to do this, use TCM0074140
  • take no further action.

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Step 3

If you have all the information needed to determine the customer’s status, go to Step 5.

If you do not have all of the information to determine the customer’s status

  • issue TC1125
  • update the Household Notes with the message IP22 from TCM0160040. For how to do this, use TCM1000001
  • BF the case for 30 days
  • take no further action.

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Step 4

If the customer has replied and provided documentation to show their refugee status, go to Step 6.

If the customer has replied and does not have the documentation to show their refugee status, contact your TALLO for advice.

If the customer has not replied

  • update Household Notes with the message IP26 from TCM0160040. For how to do this, use TCM1000001
  • take no further action.

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Step 5

If the HOCS confirms the customer’s refugee status, go to Step 6.

If the HOCS confirms the customer does not have full refugee status

  • update Household Notes with the message IP27 from TCM0160040. For how to do this, use TCM1000001
  • send any relevant correspondence to storage. For how to do this, use TCM0074140
  • take no further action.

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Step 6

Use Function ’View Application’ to check when the claim to tax credits was made. For how to do this, use TCM1000249.

Note: The date of claim will be located in the ‘Summary’ screen.

Check the information supplied by the customer about when their application for asylum was granted and they were given refugee status by the Home Office.

Note: For claims made on or after 6th April 2012 the time limit for claiming a tax credit is within 1 month and prior to 6th April 2012 within 3 months. For claims made in that time limit the claim will be treated as made on the date they first claimed asylum in the UK and on every subsequent 6 April.

If the claim for tax credit was received within the required timescales following the date the customer was notified by the Home Office of their decision to grant refugee status, go to Step 7.

If the claim for tax credits was not received within the required timescales following the date the customer was notified by the Home Office of their decision to grant refugee status

  • issue TC1157 to the customer
  • update the Household Notes with the message IP28 from TCM0160040. For how to do this, use TCM1000001
  • send any relevant correspondence to storage. For how to do this, use TCM0074140
  • take no further action.

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Step 7

Check whether NASS payments have been made to the customer.

If a full break down of NASS payments has been provided, go to Step 8.

If only the last four weeks of NASS payments has been provided

  • email the Compliance Direction Research Team to confirm the customers NASS payments and asylum lodge date
  • update Household Notes with the message IP25 from TCM0160040. For how to do this, use TCM1000001
  • BF the case for 30 days
  • take no further action.

If the customer has not provided any details of NASS payments

  • email the Compliance Direction Research Team to confirm the customers NASS payments and asylum lodge date
  • update Household Notes with the message IP25 from TCM0160040. For how to do this, use TCM1000001
  • BF the case for 30 days
  • take no further action.

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Step 8

If the claim is post award, go to Step 9.

If the claim is pre award

  • access the claim through ‘Worklist’
  • select ‘Summary Screen’
  • check the date refugee status was notified
  • check the child responsibility date in cases where the children arrived in the UK after the customer
    Note: For a customer or customers to be treated as being responsible for a child or young person that child or young person must ‘normally live’ with the customer.
  • check the earliest effective date of claim
    Note: The earliest effective date of claim is usually a maximum of one month prior to the date the claim was received for claims received after 06/04/12 and a maximum of three months prior to the date the claim was received for claims received before 06/04/12.
  • consider amending the effective date to start payment of tax credits only in cases where the date refugee status was notified or the child responsibility date is after the earliest effective date of claim
    Note: Once your backdating enquiries are complete, any tax credits payable for previous years can not be made on NTC and NTC is not amended to reflect the earlier date of claim as this is all done manually.
  • input start date at ‘Effective Date’
    Note: Use the date refugee status was notified or the child responsibility start date. For example, the date the child arrived in the UK to live with the customer.
  • select ’OK’
  • select ’Process’
  • access function ‘Manage Verification Failures’ for the claim you are working. For how to do this, use TCM1000004 and TCM1000107
    Note: You must access function ‘Manage Verification Failures’ from the Verification Failures work list and not directly from the ‘Function Menu’.
  • on the ‘Manage Verification Failures’ screen
    • select the relevant verification failure
    • select ‘Change Verification’. You will be taken to ‘Change of Status Reason’ screen
    • update the ‘Reason’ field with the appropriate message from TCM0160040 using the relevant IP note you used before
    • select ‘OK’. You will be taken back to the ‘Manage Verification Failures’ screen
    • select ‘OK’
  • when the message ‘This will re-submit the application for processing and saving changes made on this window. Do you want to proceed?’ displays, select ‘Yes’
  • go to Step 9.

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Step 9

To establish the customer’s circumstance in each tax year

  • send a separate TCPFA form to the customer for each tax year you are backdating to confirm their circumstances from the date asylum was first lodged
  • ask if the customer has received any support from their Local Authority
    Note: You only need to ask this question where no NASS payments have been received.
  • update Household Notes with the message IP22 from TCM0160040. For how to do this, use TCM1000001
  • BF the case for 30 days
  • take no further action.

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Step 10

On return of completed TCPFA.

If there is evidence to suggest the Local Authority has been involved, contact your TALLO for advice

If there is no evidence to suggest the Local Authority has been involved

  • use the ‘Tax Credits Entitlement Calculator’ to calculate WTC and / or CTC for each year. For how to do this, use TCM1000089
    Note: Consider the eligibility of the 2nd adult element when completing the calculation.
  • calculate NASS payments paid to the customer under Section 95 or 98 of the Immigration and Asylum Act 1999
    Note: Payments made under Section 4 or Integration Loans made under Section 13 are not included in the calculation.
  • deduct NASS amount paid from tax credit entitlement
  • complete a manual calculation sheet
    Note: You will need to complete a manual calculation sheet for each tax year you have calculated for WTC and / or CTC entitlement.
  • go to Step 11.

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Step 11

If any arrears remain outstanding

  • complete arrears stencil
  • issue TC1158 to the customer outlining the decision made for each tax year
  • update Household Notes with a retained note IP30 from TCM0160040. For how to do this, use TCM1000001
  • pass the payment stencil to the Manual Payments Team
  • send any relevant correspondence to storage. For how to do this, use TCM0074140
  • take no further action.

If no arrears remain outstanding

  • issue TC1158 to the customer outlining the decision made for each year that tax credits have been awarded and finalised
  • update Household Notes with the message IP29 from TCM0160040. For how to do this, use TCM1000001
  • send any relevant correspondence to storage. For how to do this, use TCM0074140
  • take no further action.