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HMRC internal manual

Tax Credits Technical Manual

HM Revenue & Customs
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Decision Making: Valid Claims, Conclusive Entitlement and Changes to Decisions: Changes to a current year award

There are numerous changes that must be notified within one month. These changes are detailed at TCTM05100. The month begins on the date the change occurs or the date the claimant became aware of the change. (The exception to this are personal income tax liability changes made under s20(2)(j), see TCTM12000)

Any change made within current year will be made using either section 15 or 16 of The Tax Credits Act.

Section 15

A change notified to HMRC that increases the maximum rate (see definition below) is changed under s15, for further details see TCTM05340.

As mentioned above, s15 can also require the claimant or a prescribed person (such as a childminder) to provide information that is required to make the new decision.

A change to the maximum rate of entitlement, can be defined as a change that adds or increases one or more of the elements that make up an award of tax credits, such as the addition of a child or the addition of the 30 hour premium.

Section 16

A change that does not increase the maximum rate is made under s16. These changes are however limited to ‘within the award period’ as defined at TCTM07020.

The wording of s16 is that:

Where, at any time during the period for which an award of a tax credit is made to a person or persons, the Board have reasonable grounds for believing-

that the rate at which the tax credit has been awarded to him or them for the period differs from the rate at which he is, or they are, entitled to the tax credit for the period,


that he has, or they have, ceased to be, or never been, entitled to the tax credit for that period, the Board may decide to amend or terminate the award.

Reasonable belief

The term ‘reasonable belief’ is not defined in tax credits legislation, however a commonly held meaning is that a reasonable belief is a belief based on information:

  • reasonably believed to be reliable and accurate; and
  • available to the decision maker