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Statutory Instruments

2002 No. 2007

TAX CREDITS

The Child Tax Credit Regulations 2002

Made

30th July 2002

Coming into force in accordance with regulation 1

M1 Whereas a draft of this instrument, which contains the first regulations made under section 9 of the Tax Credits Act 2002, has been laid before, and approved by resolution of, each House of Parliament:

Now, therefore, the Treasury, in exercise of the powers conferred on them by sections 8, 9, 65 and 67 of the Tax Credits Act 2002M2, hereby make the following Regulations:

Modifications etc. (not altering text)

Marginal Citations

M2Section 67 is cited because of the meaning ascribed to “prescribed”.

Citation, commencement and effectU.K.

1.  These Regulations may be cited as the Child Tax Credit Regulations 2002 and shall come into force—

(a)for the purpose of enabling claims to be made, on 1st August 2002;

(b)for the purpose of enabling awards to be made, on 1st January 2003; and

(c)for all other purposes on 6th April 2003;

and shall have effect for the tax year beginning on 6th April 2003 and subsequent tax years.

InterpretationU.K.

2.—(1) In these Regulations, unless the context otherwise requires—

(2) In the application of these Regulations to Northern Ireland, a reference to a provision of an enactment which applies only to Great Britain or England and Wales, shall be construed, so far as necessary, as including a reference to the corresponding enactment applying to Northern Ireland.

Textual Amendments

F4Words in reg. 2 omitted (6.4.2003) by virtue of The Child Tax Credit (Amendment) Regulations 2003 (S.I. 2003/738), regs. 1, 3(b)

Marginal Citations

M17Section 2 was substituted by section 25(1) of the Employment Act 1988 (c.19).

M21O.J. No. L149, 5.7.1971, restated in amended form in Council Regulation (EEC) No. 2001/83 (O.J. No. L230, 22.8.1983).

Circumstances in which a person is or is not responsible for a child or qualifying young personU.K.

3.—(1) For the purposes of child tax credit the circumstances in which a person is or is not responsible for a child or qualifying young person shall be determined in accordance with the following Rules.

(2) Where—

(a)a claimant is treated as responsible for a child or qualifying young person by virtue of the preceding Rules, and

(b)the child or qualifying young person has a child of his or her own, normally living with him or her,

the claimant shall also be treated as responsible for, and as having made a claim for child tax credit in respect of, the child of the child or qualifying young person (but without prejudice to the facts as to which of them is mainly responsible for that child).

Textual Amendments

Modifications etc. (not altering text)

C2Reg. 3 applied (for specified purposes and with effect in accordance with reg. 1 of the amending S.I., in force in so far as not already in force and with effect in accordance with reg. 1 of the amending S.I.) by The Tax Credits (Definition and Calculation of Income) Regulations 2002 (S.I. 2002/2006), regs. 1, 2(3)

Marginal Citations

M26S.I. 1976/965: regulation 3 was substituted by regulation 3 of S.I. 2000/2891.

Period for which a person who attains the age of sixteen remains a childU.K.

4.  A person who attains the age of sixteen remains a child for the purposes of Part 1 from the date on which he attained that age until immediately before the 1st September which next follows that date.

Maximum age and prescribed conditions for a qualifying young personU.K.

5.—(1) For the purposes of Part 1 a person ceases to be a qualifying young person (unless disqualified earlier under the following paragraphs) on the date on which he attains the age of nineteen.

(2) A person who is not a child, but has not attained the age of nineteen years, is a qualifying young person for any period during which the following conditions are satisfied with regard to him [F7(and once a person falls within the terms of paragraph (3)(b), he shall be treated as having satisfied the first condition from the date of leaving education mentioned in that paragraph)].

(3) The first condition is that he is either—

(a)receiving full-time education, not being—

(i)advanced education, or

(ii)education received by that person by virtue of his employment or of any office held by him; or

(b)under the age of eighteen years and—

[F8(i)he has ceased to receive full-time education (the date of that event being referred to as “the date of leaving education”),

(ii)within 3 months of the date of leaving education, he has notified the Board (in the manner prescribed by regulation 22 of the Tax Credits (Claims and Notifications) Regulations 2002) that he is registered for work or training with the Careers Service, the Connexions Service or the Department for Employment and Learning, and

(iii)not more than 20 weeks has elapsed since the date of leaving education.]

(4) The second condition is that the period in question is not (and does not include)—

(a)a week in which he (having ceased to receive full-time education) becomes engaged in remunerative work;

(b)a period—

(i)in which training for that person is being provided under a relevant training programme; and

(ii)in respect of which an allowance may be paid under that programme to that person; or

(c)a period in respect of which that person receives income support or income-based jobseeker’s allowance within the meaning of section 1(4) of the Jobseekers Act 1995 M28.

(5) For the purposes of paragraphs (3) and (4) full-time education is education received by a person attending a course of education—

(a)at a recognised educational establishment, or

(b)if the education is recognised by the Secretary of State, the Scottish Ministers [F9, the Board] or the Department for Employment and Learning, elsewhere,

where in pursuit of that course, the time spent receiving instruction or tuition, undertaking supervised study, examination or practical work or taking part in any exercise, experiment or project for which provision is made in the curriculum of the course, exceeds or exceeds on average 12 hours a week in normal term-time, and shall include normal gaps between the ending of one course and the commencement of another, where the person is enrolled on and commences the latter course.

(6) In calculating the time spent in pursuit of the course, no account shall be taken of time occupied by meal breaks or spent on unsupervised study.

Textual Amendments

Marginal Citations

Entitlement to child tax credit after death of child or qualifying young personU.K.

6.  If—

(a)a child or qualifying young person dies, and

(b)a person is (or would, if a claim had been made, have been) entitled to child tax credit in respect of the child or qualifying young person immediately before the death,

that person shall be entitled to child tax credit in respect of the child or qualifying young person for the period of eight weeks immediately following the death or, in the case of a qualifying young person, until the date on which he or she would have attained the age of nineteen, if earlier.

Modifications etc. (not altering text)

C4Reg. 6 applied (for specified purposes and with effect in accordance with reg. 1 of the amending S.I., in force in so far as not already in force and with effect in accordance with reg. 1 of the amending S.I.) by The Working Tax Credit (Entitlement and Maximum Rate) Regulations 2002 (S.I. 2002/2005), regs. 1, 19(2)

Determination of the maximum rate at which a person or persons may be entitled to child tax creditU.K.

7.—(1) In the following paragraphs—

(a)in the case of a single claim (but not a joint claim), the person making the claim is referred to as the “claimant”; and

(b)in the case of a joint claim, the members of the married couple or unmarried couple making the claim are referred to as the “joint claimants”.

(2) The maximum rate at which a claimant or joint claimants may be entitled to child tax credit shall be the aggregate of—

(a)the family element of child tax credit, and

(b)an individual element of child tax credit, in respect of each child or qualifying young person for whom—

(i)the claimant, or

(ii)either or both of the joint claimants,

as the case may be, is or are responsible.

(3) The family element of child tax credit—

(a)in a case where any of the children referred to in paragraph (2)(b) above is under the age of one year, is £1,090; and

(b)in any other case, is £545.

(4) The individual element of child tax credit for any child or qualifying young person referred to in paragraph (2)(b) above—

(a)where the child is disabled, is [F10£3,840];

(b)where the child is severely disabled, is [F11£4,730];

(c)in the case of any other child, is [F12£1,625];

(d)where the qualifying young person is disabled, is [F13£3,840];

(e)where the qualifying young person is severely disabled, is [F14£4,730]; and

(f)in the case of any other qualifying young person, is [F15£1,625].

Textual Amendments

F10Sum in reg. 7(4)(a) substituted (with effect in accordance with reg. 1(3) of the amending S.I.) by The Tax Credits Up Rating Regulations 2004 (S.I. 2004/941), regs. 1(1), 2(a)

F11Sum in reg. 7(4)(b) substituted (with effect in accordance with reg. 1(3) of the amending S.I.) by The Tax Credits Up Rating Regulations 2004 (S.I. 2004/941), regs. 1(1), 2(b)

F12Sum in reg. 7(4)(c) substituted (with effect in accordance with reg. 1(3) of the amending S.I.) by The Tax Credits Up Rating Regulations 2004 (S.I. 2004/941), regs. 1(1), 2(c)

F13Sum in reg. 7(4)(d) substituted (with effect in accordance with reg. 1(3) of the amending S.I.) by The Tax Credits Up Rating Regulations 2004 (S.I. 2004/941), regs. 1(1), 2(d)

F14Sum in reg. 7(4)(e) substituted (with effect in accordance with reg. 1(3) of the amending S.I.) by The Tax Credits Up Rating Regulations 2004 (S.I. 2004/941), regs. 1(1), 2(e)

F15Sum in reg. 7(4)(f) substituted (with effect in accordance with reg. 1(3) of the amending S.I.) by The Tax Credits Up Rating Regulations 2004 (S.I. 2004/941), regs. 1(1), 2(f)

Prescribed conditions for a disabled or severely disabled child or qualifying young personU.K.

8.—(1) For the purposes of section 9 of the Act a child or qualifying young person—

(a)is disabled if he satisfies the requirements of paragraph (2); and

(b)is severely disabled if he satisfies the requirements of paragraph (3).

(2) A person satisfies the requirements of this paragraph if—

(a)disability living allowance is payable in respect of him, or has ceased to be so payable solely because he is a patient; or

(b)he is—

(i)registered as blind in a register compiled by a local authority under section 29 of the National Assistance Act 1948 (welfare services) M29,

(ii)in Scotland, has been certified as blind in a register maintained by or on behalf of a local government area (as defined in the Local Government etc. (Scotland) Act 1994 M30), or

(iii)in Northern Ireland, has been certified as blind and in consequence is registered as blind in a register maintained by or on behalf of a Health and Social Services Board; or

(c)he ceased to be so registered or certified as blind within the 28 weeks immediately preceding the date of claim.

(3) A person satisfies the requirements of this paragraph if the care component of disability living allowance—

(a)is payable in respect of him, or

(b)would be so payable but for either a suspension of benefit in accordance with regulations under section 113(2) of the Contributions and Benefits Act M31 or an abatement as a consequence of hospitalisation,

at the highest rate prescribed under section 72(3) of that Act.

Marginal Citations

Jim Fitzpatrick

John Heppell

Two of the Lords Commissioners of Her Majesty’s Treasury

Explanatory Note

(This note is not part of the Regulations)

The Tax Credits Act 2002 (“the Act”) introduces new tax credits—child tax credit and working tax credit—which will be available from 6th April 2003.

Section 8 of the Act provides that entitlement of a person or persons to child tax credit is dependent on him, or (in the case of a joint claim) either or both of them, being responsible for a child or qualifying young person. These Regulations provide the meaning of “responsible” and set out ages and qualifying conditions for children and qualifying young persons. They also set out the circumstances in which child tax credit is paid for up to eight weeks after a child or qualifying young person has died.

Section 9 of the Act provides for the determination of the maximum rate of child tax credit. Subsection (2) of that section provides that the determination must include first the family element of child tax credit and, secondly, an individual element of child tax credit in respect of each child or qualifying young person for whom the claimant or (in the case of a joint claim) either or both of the joint claimants is or are responsible.

Subsection (5) of section 9 provides that the amount of those elements may vary according to the age of the child or qualifying young person or otherwise, and must be subject to cumulative increases where he or she is disabled or severely disabled.

Regulations 1 and 2 provide for the citation, commencement and effect of the Regulations, and for interpretation.

Regulation 3 determines the circumstances in which a person is or is not responsible for a child or qualifying young person, for child tax credit purposes.

Regulation 4 provides for a person who has attained the age of 16 years to remain a “child” for the purposes of child tax credit and working tax credit until the 1st September following their sixteenth birthday.

Regulation 5 provides for the maximum age for a qualifying young person (the date on which he or she attains 19 years), and the conditions which a person who is no longer a child but is under 19 has to fulfil to be a qualifying young person.

Regulation 6 prescribes the circumstances in which a person is entitled to Child Tax Credit for a child or qualifying young person who has died.

Regulation 7 prescribes the maximum rate at which a person or persons may be entitled to Child Tax Credit.

Regulation 8 defines “disabled” and “severely disabled” for the purposes of section 9 of the Act.

A regulatory impact assessment in respect of the Act has been prepared and placed in the Library of each House of Parliament. A copy can be found on the Inland Revenue website (www.inlandrevenue.gov.uk).