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HMRC internal manual

Tax Credits Manual

From
HM Revenue & Customs
Updated
, see all updates

Specialist areas: international: right to reside: right to reside - general

Reasons not to follow this guidance

You do not need to follow this guidance if

  • the customer is not a European Economic Area (EEA) national, A2 national or a Croatian national.

Checklist

Before you follow this guidance, make sure

  • you know the nationality of the customer and whether they are employed or self-employed
  • you follow the guidance in TCM0307300
  • you will the correct user roles to follow this guidance. 
  • you are in the correct MU. Use TCM0322460 for the correct MU number.

Background

For new claims made on or after 1 May 2004 (and during the initial period of derogation from the Treaty of Accession - an option not to adopt all of the provisions up to 30 April 2006), entitlement to Child Tax Credit (CTC) will depend on the customer (regardless of his or her nationality) having a ‘right to reside’ in the UK (whether under UK or EC law). This is in addition to the customer having to meet the existing tests of being present and ordinarily resident in the UK.

Entitlement to WTC is dependent upon the customer being present and ordinarily resident in the UK. EEA national workers who are exercising their rights under EC law to live and work in the UK are treated as being ‘ordinarily resident’ in the UK whilst they are working here. However, A2 and Croatian nationals who are required to register or authorise their employment with the Home Office Worker Registration Scheme (WRS), Worker Authorisation Scheme (WAS) or the Workers Authorisation Requirement (WAR) must register or obtain authorisation in order to be treated as being ordinarily resident in the UK for WTC purposes.

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

Using the information provided by the customer or on the Tax Credits system, check for the period you are considering if the customer satisfies the Right to Reside test.

If you need to determine if a person has a permanent right of residence, go to .

If you need to determine if a person has gained full free movement, go to .

If you need to determine if an A2 national or a Croatian national is exempt from registration, go to .

If you need to determine if the customer is a family member of a qualified person, go to .

If you need to determine if the customer is a previously employed person with children in formal education in the UK, go to .

If you need to determine if the customer is a student, go to .

If you need to determine if the customer is a worker, go to .

If you need to determine if the customer is self-sufficient, go to .

If you need to determine if the customer is a work seeker, go to .

If you need to determine if the customer is registered on WAS or WAR, go to .

If you need to determine if the customer is self-employed, go to .

Step 2

If the customer is an EEA or Swiss national who has resided in the UK and has had a right to reside here for a continuous period of five years, go to .

Note: You must consider all the possible reasons for the right to reside before deciding if the customer fits this criteria.

Note: The EEA or Swiss national must have had a right to reside throughout this five year period

If the customer is a family member of an EEA national or a Swiss national who has a right to reside here for a continuous period of five years and has resided in the UK with them, go to .

Note: Family member includes the customer’s spouse or civil partner, direct descendants of the customer or their spouse or civil partner and dependant direct relatives in the ascending line of the customer and his/her spouse or civil partner

If the customer is a worker or self-employed person who has ceased activity, go to .

Note: The main criteria that must be satisfied for a person to acquire a permanent right to reside as a worker who has ceased activity are as follows:

If, on the date they ceased activity as an employed or self employed person,

* they had either reached state pension age or took early retirement and
* they pursued that activity for at least 12 months prior to the date activity ceased and
* they had resided continuously in the UK for three years or more

or

* they ceased activity as an employed or self employed person as a result of permanent incapacity for work and either resided in the UK continuously for two years prior to the date of termination, or the incapacity for work was as a result of an accident at work or an occupational disease that entitles them to a pension paid in full or part by a UK institution

or

* the person is a worker or self employed person in an EEA member state but retains a residence in the UK to which they returns as a rule at least once a week and prior to becoming active as an employed or self employed person in an EEA state they resided in the UK and been active as an employed person in the UK for at least three years.

If the customer is a family member of a worker or self-employed person and the worker or self-employed person has died, go to

If any other circumstances apply, go to

Step 3

If the customer resided with the worker immediately before their death and the worker or self-employed person resided continuously in the UK for at least two years immediately before their death, go to

If the family member resided with the worker immediately before their death and the death was the result of an accident at work or an occupational disease, go to

If any other circumstances apply, go to

Step 4

The customer has a permanent right of residence

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 5

The customer does not appear to have a permanent right of residence

Note: If the customer states they have a permanent right to reside, refer to your TALLO for advice.

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 6

Using the information provided by the customer or the information on WAS or WAR, check if the worker has previously been in registered employment for 12 months or more.

Note: The customer can have more than one period of employment in this time. They must have registered this employment within one calendar month of starting.

Note: Periods of unemployment must not total more than 30 days in any 12-month period.

Note: If the period of Right to Reside you are considering is after 1 January 2014, A2 nationals are treated in the same way as nationals from any other EEA country.

Note: If the period of Right to Reside you are considering spans 1 January 2014 and the customer is employed in the UK then, unless exempt from employment authorisation, treat as A2 national (check WAS for employment registration) up to and including 31 December 2013.

If the customer or family member has previously been in registered employment for 12 months or more, go to .

If the customer or family member has not previously been in registered employment for 12 months or more, go to .

Step 7

The customer has full free movement rights

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 8

The customer does not have full free movement rights

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 9

Using the information provided by the customer and the definitions for an A2 or Croatian national who may be exempt from registering, check if the A2 or Croatian national satisfies any of the reasons for exemption for the period you are considering the Right to Reside test.

Note: Keep in view that the A2 national or Croatian national may fulfil the criteria for being exempt from registration from a period before the period you are considering.

Note: If a customer provides a blue residency card entitled ‘UK Residence Documentation for a National of an EEA State’ and they are a worker, unless they fall into one of the exemptions they are still required to register their employment. A blue card alone is not sufficient evidence that the A2 customer is registered on WAS or for a Croatian customer registered on Workers Authorisation Requirement (WAR) or is exempt from registration.

Note: Estonia, Latvia, Lithuania, Poland, Czech Republic, Slovakia, Hungary and Slovenia are commonly referred to as the A8 member states. This is because up to 30 April 2011, unless exempt from registration, nationals from these member states were required to register their employment with the Home Office Worker Registration Scheme (WRS). This scheme came to an end on 30 April 2011 and from 1 May 2011 nationals from the A8 member states working in the UK are no longer required to register their employment with the Home Office. From 1 May 2011 customers arriving from these member states are treated in the same way as nationals from any other EEA member state.

Note: From the 1 July 2013 Croatia became a member of the EU unless exempt from registration, nationals from Croatia are required to authorise their employment with the Home Office.

Note: Bulgaria and Romania are commonly referred to as the A2 member states. Until 31 December 2013, unless exempt from registration, nationals from these member states are required to register their employment in the UK with the Home Office Worker Authorisation Scheme (WAS). This scheme comes to an end on 31 December 2013. From 1 January 2014 nationals from A2 member states working in the UK are no longer required to register their employment with the Home Office. From 1 January 2014 customers arriving from these member states are treated in the same way as nationals from any other EEA member state.

If the A2 or Croatian national is exempt from registration for the period you are considering the Right to Reside test

  • make a note of this
  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

If the A2 or Croatian national is not exempt from registration for the period you are considering the Right to Reside test

  • make a note of this
  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 10

Check if the customer is a family member of a qualified person for the period you are considering the Right to Reside test, using

Note: You must refer to all the relevant definitions mentioned above before considering the ‘If’ options below.

Note: It may be possible for the person to be a qualified person for more than one reason.

Note: A family member is defined as - their spouse or civil partner; their direct descendants or their spouse’s or civil partner’s direct descendants who are aged under 21; or dependant direct relatives in the ascending line or that of their spouse or civil partner. For more information, use TCM0320360

If the customer is a family member of a self-employed person, go to .

If the customer is a family member of a student, go to .

Note: You must consider the definition of a student, use TCM0320400. If the person does not fulfil the criteria in that definition and have sufficient resources for themselves and their family member, the customer can not be classed as a family member of a student.

If the customer is a family member of a work seeker, go to .

If the customer is a family member of a self-sufficient person, go to .

If the customer is a family member of a worker, go to .

If the customer is a family member of a person who has acquired full free movement rights, go to .

If any other circumstances apply, go to .

Step 11

Check if the worker is an A2 or a Croatian national or any other EEA national.

Note: Bulgaria and Romania are commonly referred to as the A2 member states. Until 31 December 2013, unless exempt from registration, nationals from these member states are required to register their employment in the UK with the Home Office Worker Authorisation Scheme (WAS). This scheme comes to an end on 31 December 2013. From 1 January 2014 nationals from A2 member states working in the UK are no longer required to register their employment with the Home Office. From 1 January 2014 customers arriving from these member states are treated in the same way as nationals from any other EEA member state.

If the worker is an A2 or Croatian, go to .

If the worker is any other EEA national, go to .

Step 12

If the customer is a family member of a worker who is an A2 national and who is subject WAS or a Croatian national who is subject to WAR, check if they are authorised to work.

Note: If the A2 or Croatian worker has complied with their obligations to register or authorise, the family member will have a right to reside as a family member of the worker. If the worker has not complied with their obligations to register or authorise and is not exempt, the family member does not have a right to reside as a family member of the worker.

Note: It may be possible for the worker to be a qualified person for more than one reason.

Note: If a customer provides a blue residency card entitled ‘UK Residence Documentation for a National of an EEA State’ and they are a worker, unless they fall into one of the exemptions they are still required to register their employment. A blue card alone is not sufficient evidence that the A2 customer is registered on WAS or for a Croatian customer registered on WAR or is exempt from registration.

Note: If the period of Right to Reside you are considering is after 1 January 2014, A2 nationals are treated in the same way as nationals from any other EEA country.

Note: If the period of Right to Reside you are considering spans 1 January 2014 and the customer is employed in the UK then, unless exempt from employment authorisation, treat as A2 national (check WAS for employment registration) up to and including 31 December 2013.

If the worker is in registered or authorised work or is exempt from registration or authorisation, go to .

If the worker is not in registered or authorised work and is not exempt from registration or authorisation, go to .

Step 13

Check if the work seeker has acquired full free movement rights. For more information, use TCM0320140

If the work seeker has acquired full free movement rights, go to .

If the work seeker has not acquired full free movement rights, go to .

Step 14

The customer can be classed as a family member of a qualified person

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 15

The customer can not be classed as a family member of a qualified person

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 16

Using the information provided by the customer, check if the customer was the primary carer for a child in formal education in the UK for the period you are considering the Right to Reside test.

Note: Formal education is compulsory schooling for school age children, sixth form college or similar.

Note: The education does not refer to pre-school nurseries but to formal education.

If the customer was the primary carer for a child in formal education in the UK for the period you are considering the Right to Reside test, go to .

If the customer was not the primary carer for a child in formal education in the UK for the period you are considering the Right to Reside test, go to .

Step 17

Check if one of the child’s parents is an EEA national.

Note: Bulgaria and Romania are commonly referred to as the A2 member states. Until 31 December 2013, unless exempt from registration, nationals from these member states are required to register their employment in the UK with the Home Office Worker Authorisation Scheme (WAS). This scheme comes to an end on 31 December 2013. From 1 January 2014 nationals from A2 member states working in the UK are no longer required to register their employment with the Home Office. From 1 January 2014 customers arriving from these member states are treated in the same way as nationals from any other EEA member state.

If one of the child’s parents is an EEA national, go to .

If neither of the child’s parents are EEA nationals, go to .

Step 18

Check if one of the child’s parents was present in the UK and working legally in employer employment on or before the child started formal education

Note: If the parent who was working is an A2 or Croatian national, the employment must have been authorised, if the customer was not exempt from authorisation.

Note: If the period of Right to Reside you are considering is after 1 January 2014, A2 nationals are treated in the same way as nationals from any other EEA country.

Note: If the period of Right to Reside you are considering spans 1 January 2014 and the customer is employed in the UK then, unless exempt from employment authorisation, treat as A2 national (check WAS for employment registration) up to and including 31 December 2013.

If one of the child’s parents was working legally in employer employment on or before the child started formal education, go to .

If neither of the child’s parents were working legally in employer employment on or before the child started formal education, go to .

Step 19

Check if the worker or former worker was present in the UK during part of the time the child entered formal education.

If the worker or former worker was present in the UK during part of the time the child entered formal education, go to .

If the worker or former worker was not present in the UK during part of the time the child entered formal education, go to .

Step 20

Check if the child is aged 18 or under.

Note: If the child is under 18, they will have a right to reside in the UK for the duration of their formal education and their primary carer will also have a right to reside for the duration of the child’s formal education.

If the child is aged 18 or under, go to .

If the child is not aged 18 or under, go to

Step 21

Check if the child needs the customer’s continuing support and care in order to complete their formal education.

Note: If the child is over 18, the child and primary carer will have a right to reside in the UK if the child has a particular need for continuing care from the primary carer. For example, if the child has a disability which needs particular ongoing care in order for the child to complete their education.

If the child continues to need the customer’s support and care in order to complete their formal education, go to .

If the child does not continue to need the customer’s support and care in order to complete their formal education, go to .

Step 22

The customer is the primary carer of a child with a right to reside in the UK. The Right to Reside test is satisfied

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 23

The customer is not the primary carer of a child with a right to reside in the UK. The Right to Reside test is not satisfied

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 24

Using the information provided by the customer and the definition of a student, check if the customer is regarded as a student or family member of a student for the period you are considering the Right to Reside test. For more information about students, use TCM0320400

If the customer is regarded as a student or family member of a student for the period you are considering the Right to Reside test, go to .

If the customer can not be regarded as a student or family member of a student for the period you are considering the Right to Reside test, go to .

Step 25

The customer is a student

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 26

The customer is not a student

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 27

Using the information provided by the customer and the definition of a worker, check if the customer is regarded as a worker for the period you are considering the Right to Reside test.

Note: To be in employment, the customer must be undertaking work, under the direction of someone else, for which they are paid. This does not mean self-employment.

Note: If the period of Right to Reside you are considering is after 1 January 2014, A2 nationals are treated in the same way as nationals from any other EEA country.

Note: If the period of Right to Reside you are considering spans 1 January 2014 and the customer is employed in the UK then, unless exempt from employment authorisation, treat as A2 national (check WAS for employment registration) up to and including 31 December 2013.

If the customer is regarded as a worker for the period you are considering the Right to Reside test, go to .

If the customer can not be regarded as a worker for the period you are considering the Right to Reside test, go to .

Step 28

The customer is a worker

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 29

The customer is not a worker

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 30

Using the information provided by the customer or the information held on the tax credits computer, check if the customer has completed the other income box and/or other house old income box for the period you are considering the Right to Reside test.

Note: If a customer has not any other resources such as income or capital we can conclude that they are not self-sufficient. You must always take the personal circumstances of the customer into account so that each case is determined on its merits.

If there are not any other means of income in the ‘Other Income’ or ‘Other Household Income’ box and the customer is not claiming benefits for the period you are considering the Right to Reside test

  • make a note of this
  • go to .

If there are other means of income in the ‘Other Income’ or ‘Other Household Income’ box and the customer is not claiming benefits for the period you are considering the Right to Reside test

  • make a note of this
  • go to .

Step 31

Check if the customer has indicted they have any other source of money.

If the customer has indicated they have another source of money

  • make a note of this
  • go to .

If the customer has indicated they have not another source of money

  • make a note of this
  • go to .

Step 32

Check if the customer has sufficient money to support themselves and any children.

Note: We can not set a fixed amount which can be regarded as ‘sufficient resources’. You must take into account the personal situation of the individual concerned. As a general guide, we can expect them to have enough money to keep themselves above the basic limit for Income Support. If you are working one of these cases and you are not sure if the amount of money can support the customer and their children and you are considering disallowing the claim, refer the case to your TALLO first.

Note: In a joint claim where the only income entering the household is from unregistered or unauthorised earnings, you shouldn’t treat the non-working partner as self-sufficient and you shouldn’t regard the working partner as having a right to reside as a family member of a self-sufficient person.

If the customer has sufficient money to support themselves and any children, go to .

If the customer does not have sufficient money to support themselves and any children, go to .

Step 33

The customer is self-sufficient

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 34

The customer is not self-sufficient

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 35

Check if the customer is a work seeker for the period you are considering the Right to Reside test. (A2 nationals or Croatian nationals who have not acquired full free movement rights can not have a right to reside as a work seeker)

  • the information provided by the customer
  • the definition of a work seeker
  • the information held on

    • the Common Enquiry System (CES)
    • Child Benefit Online (CBOL). For how to do this, use TCM1000470
    • the Access to DWP Data system (ADD). For how to do this, use TCM1000014.

Note: Where the customer has been refused Income Support or Jobseeker’s Allowance, and provided that the decision is up to date and that we have no other evidence that the claimants circumstances may have changed since the decision, then the decision should be followed. The customer must not fail the Right to Reside test simply because they have been refused a Department for Work and Pensions (DWP) benefit (all relevant facts need to be considered before making a decision on right to reside)

Note: Bulgaria and Romania are commonly referred to as the A2 member states. Until 31 December 2013, unless exempt from registration, nationals from these member states are required to register their employment in the UK with the Home Office Worker Authorisation Scheme (WAS). This scheme comes to an end on 31 December 2013. From 1 January 2014 nationals from A2 member states working in the UK are no longer required to register their employment with the Home Office. From 1 January 2014 customers arriving from these member states are treated in the same way as nationals from any other EEA member state.

If the customer is a work seeker for the period you are considering the Right to Reside test, go to .

If the customer is not a work seeker for the period you are considering the Right to Reside test, go to .

Step 36

The customer is a work seeker

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 37

The customer is not a work seeker

Note: If, after continuing with the right to reside action, you determine the customer does not have a right to reside for another reason but the customer is relying on being a work seeker for passing the Right to Reside test, refer the case to your TALLO for advice.

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 38

Check WAS or WAR to determine if there is an entry on the database for the employment you are considering

Note: The customer must be registered or authorised for each period of employment you are considering unless they are exempt.

Note: If a customer provides a blue residency card entitled ‘UK Residence Documentation for a National of an EEA State’ and they are a worker, unless they fall into one of the exemptions they are still required to register their employment. A blue card alone is not sufficient evidence that the A2 customer is registered on WAS or for a Croatian customer registered on Workers Authorise Requirement (WAR) or is exempt from registration.

Note: If the period of Right to Reside you are considering is after 1 January 2014, A2 nationals are treated in the same way as nationals from any other EEA country.

Note: If the period of Right to Reside you are considering spans 1 January 2014 and the customer is employed in the UK then, unless exempt from employment authorisation, treat as A2 national (check WAS for employment registration) up to and including 31 December 2013.

  • make a note of whether the customer’s employment is registered or authorised
  • make a note of the dates of registration
  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 39

Check if the customer is (or was) self-employed for the period you are considering the Right to Reside test using

  • the information provided by the customer
  • the following information held on the tax credits computer. For how to do this, use TCM1000249

    • a Unique Tax Reference (UTR) number

    or

    • a start date for self employment
  • the National Insurance Recording System (NIRS). For how to do this, use TCM1000477

Note: By ‘self-employed’, we mean someone who works for themselves and not an employer and carries on a trade, profession or vocation which is commercial with a view to the realisation of profits.

If the customer is or was self-employed for the period you are considering the Right to Reside test, go to

If the customer is not or was not self-employed for the period you are considering the Right to Reside test, go to .

Step 40

The customer is a self-employed person

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.

Step 41

The customer is not a self-employed person

  • take no further action in this guidance and return to the Rules Based Service - International right to reside test.