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HMRC internal manual

Tax Credits Technical Manual

Calculation of awards: Step 3 - Determining whether income needs to be taken into account and applying income tapers

Income is equal to or less than income threshold

If the income is equal to or less than the “income threshold” the maximum amount of tax credit entitlement is due for that relevant period

The taper calculation for that individual entitlement period is complete. The next relevant period is then considered.

When all relevant periods have been considered the results are used to calculate the daily rates due for each relevant period.

See worked example (TCTM07APPX2)