HMRC internal manual

Tax Credits Technical Manual

Entitlement: CTC entitlement: Late notification that a Qualifying Young person met the qualifying conditions from 1 September

You should check the other guidance available on GOV.UK from HMRC as Brexit updates to those pages are being prioritised before manuals.

The Child Tax Credit Regulations 2002, Regulation 4

Where HMRC are notified that a qualifying young person continued in full time non advanced education from 1 September following their 16th birthday, the young person element should be included in the award effective from 1 September.

This isn’t a change of circumstances as described in TCTM05000, nor is it a backdating matter and so it isn’t limited to the backdating provisions that actual change of circumstances are, as shown in TCTM0530.

This shouldn’t be confused with a young person who is returning to full time non advanced education after a break. Where they are returning to full time non advanced education after having a break from it, these will be treated as a normal change of circumstance described in TCTM05000.

Note: If the tax credit award ends because the young person is not in full time non-advanced education and the claimant then claims Universal Credit, they cannot claim tax credits unless they get the severe disability premium or got it in the past month and are still eligible for it. If the young person has continued in full time non-advanced education the award may be reinstated up to the day before the date of the Universal Credit claim (see examples below for details).

The following examples will show the different times that HMRC is notified of the young person continuing in full time education and how the element should be included.

Example 1

Kate turns 16 on 30 June 2019 and continues to meet the qualifying young person conditions until the following 31 August 2019. From the 1 September 2019 CTC is no longer paid for Kate, but her mother does not realise payments ceased until the following February 2020 when she informs the Call Centre that Kate continued in full-time non-advanced education. As Kate continued to meet the qualifying young person conditions, the young person CTC element should be included in the award from 1 September 2019.

Example 2

Kate turns 16 on 30 June 2019 and continues to meet the qualifying young person conditions until the following 31 August 2019. From the 1 September 2019 CTC is no longer paid for Kate, but her mother does not realise payments ceased until she is completing her s17. She states that her circumstances are not correct because Kate remained in full-time non advanced education. As Kate continued to meet the qualifying young person conditions, the young person CTC element should be included in the award from 1 September 2019.

Example 3

Kate turns 16 on 30 June 2019 and continues to meet the qualifying young person conditions until the following 31 August 2019. From the 1 September 2019 CTC is no longer paid for Kate, but her mother does not realise payments ceased. She has already completed her s17 and received her finalised s18 decision on entitlement on 15 May 2020. Her Mother makes a further s17 declaration or statement on 15 July 2020, stating Kate remained in full time non advanced education. Because she has made a further s17 declaration prior to 1SD and because Kate continued to meet the qualifying young person conditions, HMRC should make a further s18(1) decision and include the young person CTC element from 1 September 2019.

Example 4

Kate turns 16 on 30 June 2019 and continues to meet the qualifying young person conditions until the following 31 August 2019. From the 1 September 2019 CTC is no longer paid for Kate, but her mother does not realise payments ceased. She has already completed her s17 and received her finalised s18 decision on entitlement on 29 July 2020. Her Mother requests a Mandatory Reconsideration on 15 August 2020, stating that Kate had remained in full time non advanced education. Because the s17 indicated all the circumstances were correct, HMRC made the s18(1) decision accordingly, but the reason for the MR states that Kate continued to meet the qualifying young person conditions. Because of this, CTC entitlement should have continued, and therefore HMRC should remake the s18(1) decision and include the young person element from 1 September 2019.

Important: If the award ended on 31 August 2019 and the mother claims Universal Credit, the tax credit award can only be reinstated up to and including the day before the date of the Universal Credit claim.

Please note that this guidance is to follow only:

• During CY where it is established that the YP continued in FTNAE from the 1 September. S16 is the appropriate power to use here when applying retrospective CTC entitlement to 1 September.

• In the year after this, where, ahead of, or during the making of the s18 entitlement decision, it is established that the young person continued in FTNAE from the 1 September in the previous year.

• By MR Officers handling a MR in response to any of the above two decisions. Providing of course that the MR is, or can be treated as made, on time.

 

The following examples are where HMRC has been notified late that the child continued in FTNAE and met the qualifying young person conditions, but we cannot include the child from 1 September.

Example 5

Kate turns 16 on 30 June 2019 and continues to meet the qualifying young person conditions until the following 31 August 2019. From the 1 September 2019 CTC is no longer paid for Kate, but her mother does not realise payments ceased. She has already completed her s17 and received her finalised s18 entitlement decision on 29 July 2020. Her Mother informs HMRC on the 15 October 2020 that Kate had remained in full time non advanced education. Because the s17 indicated all the circumstances were correct, HMRC made the s18(1) decision accordingly and no Mandatory Reconsideration was requested stating that Kate continued to meet the qualifying young person conditions. Therefore HMRC can only include the CTC from the 6 April 2020.

Important: If the award ended on 31 August 2019, the claimant can only claim tax credits if she gets the severe disability premium or got it in the past month and is still eligible for it. She may be able to apply for Universal Credit (if she is of working age) or Pension Credit (if she is of Pension Credit qualifying age).

Example 6

Kate turns 16 on 30 June 2019 and continues to meet the qualifying young person conditions until the following 31 August 2019. From the 1st September 2019 CTC is no longer paid for Kate but her mother does not realise payments have ceased. She claims Universal Credit on 20 December 2019. She completed her s17 (in-year finalisation) on 10 January 2020 and received her finalised s18 entitlement decision on 24 January 2020. Kate’s mother informs HMRC on 28 March 2020 that Kate had remained in full time non-advanced education. Because the s17 indicated all the circumstances were correct, HMRC made the s18(1) decision accordingly and no Mandatory Reconsideration was requested stating that Kate continued to meet the qualifying young person conditions. CTC cannot be paid for Kate after 31/08/2019.