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HMRC internal manual

Tax Credits Technical Manual

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HM Revenue & Customs
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Payments of Tax Credits: Payments other than to a bank, building society or other account

Circumstances in which the Commissioners will pay other than to an account

Tax Credits Act 2002 s24

Tax Credits (Payment by the Commissioners) Regulations 2002, Regs 13 & 14

Where it does not appear to the Commissioners for HM Revenue & Customs to be appropriate to pay tax credits to an account notified to them by the person to whom the tax credits are to be paid, the Commissioners may pay those tax credits in such other manner as appears to them to be appropriate.

If no account has been notified by the claimant(s) to the Commissioners for HM Revenue & Customs, the Commissioners may pay the tax credits in such manner as appears to them to be appropriate.

Where the claimant(s) have failed to notify an account to the Commissioners for HM Revenue & Customs by the date specified payments will be postponed. Cashcheques will normally be paid for 4 weeks beginning with the date the Commissioners give notice to the claimant(s) of the requirement for them to notify an account,

Where, within the period prior to postponement, the claimant(s)

  • request from the Commissioners the authority to open an account, and
  • provide sufficient information from which the Commissioners can give that authority

Cashcheque payments can be extended for 3 weeks beginning with the date the Commissioners give that authority, or

In a case where the claimant has a reasonable excuse for

  • not being able to take all necessary steps to obtain an account within the relevant time as described above, or
  • for not being able to notify the Commissioners for HM Revenue & Customs of an account within the relevant time as described above

Cashcheque payments can be extended until the date by which the account can reasonably be expected to be notified to the Commissioners.

Where there are exceptional circumstances likely to mean the claimant(s) will be unable to obtain an account during the period of the award, the Commissioners will continue payment by cashcheque throughout the period of the award

Where the claimant(s) fail to notify an account to the Commissioners for HM Revenue & Customs

Following postponement of payments if the claimant has still not notified an account by the relevant time (see below for a definition) they shall cease to be entitled to tax credits for the remainder of the period of the award beginning on the day from which the Commissioners decided to postpone payment.

The relevant time

The relevant time is the earlier of:

  • three months after the time when the Commissioners decided to postpone payments of tax credits, or
  • immediately after the end of the relevant tax year

Where a claimant notifies an account to the Commissioners for HM Revenue and Customs after payment is postponed

Where the claimant(s) notifies an account to the Commissioners for HM Revenue & Customs whilst payments are postponed, payments of tax credits may be resumed. They do not need to make a new claim; it is sufficient that they notify an account.

Where a claimant notifies an account to the Commissioners for HM Revenue and Customs after the relevant time and entitlement has ceased

Tax Credits Act 2002 s3

Where the claimant(s) notifies an account to the Commissioners for HM Revenue & Customs after entitlement has been ceased, a new claim must be made.

Exceptional circumstances must be determined on a case by case basis on the merits of the individual case, but examples may include

Unable to obtain an account during the period of the award

  • Claimant has been refused a Post Officecard account
  • Claimant is severely disabled, unable to operate an account and has no appointee to operate an account on their behalf
  • Claimant is of no fixed abode

Unable to obtain an account during the relevant period

  • Claimant has been ill or abroad or passed from one account to another

Claimant has a Personal Invitation Document for a Post Office card account but has left it too late to set up the account within the relevant period

Frequency of payments made other than to an account

Tax Credits Act 2002 s24

Tax Credits (Payment by the Commissioners) Regulations 2002, Reg 9

Where the Commissioners for HM Revenue & Customs are making payments of tax credits by a method other that directly to an account notified to them by the claimant, they may make those payments at such frequency as appear to them to be appropriate.