Tax Credits: Claims starting
Now that Universal Credit (UC) is available across the UK, HMRC state that it is no longer possible for anyone to make a new claim for tax credits. See our who can claim page for more information.
Once a claim is captured on the HMRC system, having been accepted as valid and complete and gone through eligibility, verification and risk assessment stages, HMRC will decide whether or not to make an initial award under Section 14 Tax Credit Act 2002.
HMRC guidance states -
When a new claim is received and we have accepted it as valid we have two choices:
to make a decision on entitlement under s14(1). This can be to reject the claim because they do not meet the eligibility criteria or if they meet the eligibility criteria they must decide on the amount of the award. Or
to ask the claimant or their childcare provider or their employer for information or evidence before making a decision under s14(2).
You can find information on how HMRC calculate the initial award in the online tax credit manual.
Each award will be made for an award period. If the claim is a completely new claim, the initial award will cover the period from the effective date to the end of the tax year (5 April).
If the claim is made as a result of the ‘renewals’ process, it will cover a full tax year from 6 April – 5 April.
The effective date is the date on which the claim is treated as being made. More information about establishing the effective date is available in the tax credit manual. This may not necessarily be the date the claim form was received by HMRC as some claimants may be entitled to backdating. Some claims will be backdated automatically by the system, others will not be backdated automatically even though there may be entitlement. More information about backdating can be found in the making a claim section.
Tax credits can be paid weekly or four weekly, generally in arrears. Information about how HMRC determine payment amounts can be found in the tax credit manual.
The initial award will be issued in the form of a tax credit award notice (TC602). Accompanying this will be a checklist to enable claimants to check the details on the notice are correct. The award notice must be checked very carefully and any mistakes notified to HMRC within 30 days in order to minimise any overpayments.
The initial award decision carries the right of appeal.
Last reviewed/updated 14 April 2022