In relation to a person or persons entitled to child tax credit, the rate shall be determined by finding the rate for each relevant period and, where necessary, adding together those rates.

The rate for each relevant period shall be found in accordance with the following steps—

• Step 1 — finding the daily maximum rate for each element

  For each element of the tax credit to be included in the case of the person or persons entitled to the tax credit, find the daily maximum rate using the following formula—

  $\frac{\mathrm{MR}}{\mathrm{N1}}$

  where— “MR” is the maximum rate in relation to that element for the tax year to which the claim for the tax credit relates;

  “N1” is the number of days in that tax year.

• Step 2 — finding the maximum rate for the relevant period for each element

  For each element of the tax credit to be so included, find the amount produced by multiplying the maximum rate (found under Step 1 and rounded up to the nearest penny) by the number of days in the relevant period.

• Step 3 — finding income for the relevant period

  Find the income for the relevant period by using the following formula—

  $\frac{I}{\mathrm{N1}}x\mathrm{N2}$

  where— “I” is the relevant income for the tax year to which the claim for the tax credit relates;

  “N1” is the number of days in that tax year;

  “N2” is the number of days in the relevant period.

• F1F2F3F4F5F6F7F12F13F14F15F16F17F18Step 4 — finding the threshold for the relevant period

  Find the amount produced by the following formula—

  $\frac{\mathrm{\pounds 13,230}}{\mathrm{N1}}x\mathrm{N2}$

  where— “N1” is the number of days in that tax year;

  “N2” is the number of days in the relevant period.

  The threshold for the relevant period is—

  1. a

     in the case of a person or persons entitled to child tax credit only, that amount;

  2. b

     in the case of a person or persons entitled to both child tax credit and working tax credit—

     1. i

        that amount; or

     2. ii

        if greater, the lowest amount of income for the relevant period (found under Step 3) which, disregarding regulation 9, would result in a determination in accordance with regulation 7 providing for no rate of working tax credit in his or their case for that period.

• Step 5 — finding the amount of the reduction of the elements of the tax credit F9...

  Find the amount (if any) which is F841% of the amount by which the income for the relevant period (found under Step 3 and rounded down to the nearest penny) exceeds the threshold for the relevant period (found under Step 4 and rounded up to the nearest penny).

• Step 6 — reducing the elements of the tax credit F9...

  If the amount found under Step 5 (rounded down to the nearest penny) is less than the total of the amounts found under Step 2 for the elements of the tax credit F9..., deduct the amount found under Step 5 (rounded down to the nearest penny) from the total of those amounts.

• Step 7 — reducing the elements of the tax credit F9... to nil

  If the amount found under Step 5 (rounded down to the nearest penny) is equal to or exceeds the total of the amounts found under Step 2 for the elements of the tax credit F9..., reduce the total of those amounts to nil.

• F10...

• F10...

• F10...

• F11Step 8 — finding the rate for the relevant period

  F11The rate for the relevant period is the total of the amounts found under Step 2 for the elements of the tax credit after any reduction in accordance with Step 6 or Step 7.

“The family element” means the family element of child tax credit within the meaning given by section 9(3) of the Act.