Explanatory note

These Regulations are made under provisions of the Tax Credits Act 2002 (c. 21) in order to make amendments to the Working Tax Credit (Entitlement and Maximum Rate) Regulations 2002 (S.I. 2002/2005) (“the Working Tax Credit Regulations”) with effect from 6th April 2015.

Regulation 3 substitutes a new definition of self-employed into regulation 2 of the Working Tax Credit Regulations so that for the purposes of those Regulations self-employed means carrying on a trade, profession or vocation on a commercial basis and with a view to the realisation of profits either on one’s own account or as a member of a business partnership and the trade, profession or vocation is organised and regular.

Regulation 4 amends the “First condition” in regulation 4(1) of the Working Tax Credit Regulations which needs to be satisfied for a person to be in qualifying remunerative work for working tax credit purposes. The amendment clarifies that the person must be employed or self-employed (as defined in regulation 2).

Regulation 5 adds a new paragraph (6) into regulation 4 of the Working Tax Credit Regulations so as to ensure that references in that regulation to “work” and “working” are to be construed as references to any work undertaken as a person who is employed or self-employed.

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