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HMRC internal manual

Tax Credits Technical Manual

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HM Revenue & Customs
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Payment of tax credits: Payment after the end of the tax year

Award end dates

Tax Credits Act 2002, section 5

Unless they have been ended earlier by a decision under section 16(1) Tax Credits Act to terminate the award, all tax credits awards end with the end of the tax year for which they were made, on 5 April.

In principle, this would mean that claimants would stop receiving tax credits payments from 6 April and could not receive any more tax credits until they claimed again. However, such an interruption of payment would be contrary to the intent of the tax credits scheme to provide a steady stream of support.

Circumstances in which tax credits payments may continue beyond the end of the tax year

Tax Credits Act 2002, section 24

Tax Credits (Payment by the Commissioners) Regulations 2002, Reg 7

Section 24 of the Tax Credits Act provides, in certain circumstances, for continuation of payment beyond the end of the tax year during the period in which the claimant is entitled to make a claim for tax credits for the new tax year.

These payments beyond the end of the tax year are commonly known as provisional payments and are treated as if they were payments of tax credits for the new tax year. They are, in effect, payments on account against a new award which it is anticipated will be made for the new tax year.

The Commissioners for HM Revenue & Customs can make these provisional payments after the tax year end when:

  • a claim has been made, or treated as made, for the new tax year but the Commissioners for HM Revenue & Customs have yet to take a decision under section 14(1) Tax Credits Act in relation to that claim; or
  • no claim has been made, or treated as made, in relation to the new tax year and the Commissioners for HM Revenue & Customs have not made a decision under section 18(1) Tax Credits Act (a finalisation decision) in relation to the previous tax year.