Explanatory note

Starting on 6 April 2012

Regulations 2(3) to 2(10), 2(14) to 2(16), 2(19), 2(20), 5(3) and 9 amend tax credit regulations to implement changes to the Working Tax Credit (“WTC”) eligibility rules so that couples with children must work 24 hours per week between them with one partner working at least 16 hours per week to qualify for WTC. They add new requirements for joint claims by and changed circumstances of couples, and they also remove the 50 plus element. They also apply the changed eligibility rules to polygamous units.

Regulations 2(11)(c), 2(12), 2(13)(c) and 2(17)(c)(iii) amend tax credit regulations to preserve the working tax credit position when an incapacitated person becomes assessed as having a limited capability for work and moves to employment and support allowance.

Regulations 2(18), 5(2), 5(4) and 7 amend tax credit regulations to reduce the time for which claims for tax credits can be backdated, and for which backdated claims can be paid, to 31 days (from 93 days) or to 1 month (from 3 months).

Regulations 3(1) and 3(2) make amendments to tax credits regulations to provide for the Continuity of Education Allowance, and the payment or reimbursement of fees relating to the specified vulnerable persons’ monitoring schemes, to be disregarded when calculating employment income for the purposes of tax credits.

Regulation 4(4) amends tax credit regulations so that a child attaining the age of 16 on 31 August becomes a qualifying young person from that birthday for child tax credit purposes.

Regulation 6(2) makes an amendment to tax credits regulations that reduces to 4 weeks (from 8 weeks) the period in which a person should notify an account to which HM Revenue & Customs may make tax credit payments.

Regulations 2(2)(b), 3(3), 4(2), 4(3) and 8 take the opportunity to update legislative references in tax credits regulations.

Starting on 1 May 2012

Regulations 2(2)(a), 2(11)(a) to 2(11)(b), 2(13)(a) to 2(13)(b), and 2(17)(a) to 2(17)(c)(ii) make amendments to tax credits regulations to preserve the working tax credit position on introduction of a time limit to contribution-based employment and support allowance for recipients in the work related activity group.

A full Impact Assessment has not been produced for this instrument as no impact on the private or voluntary sectors is foreseen.