AM CTC 3759 2014
| Jurisdiction | UK Non-devolved |
| Judge | Judge K Markus QC |
| Judgment Date | 17 June 2015 |
| Neutral Citation | 2015 UKUT 345 AAC |
| Subject Matter | Tax credits and family credit |
| Respondent | HM Revenue and Customs (TC) |
| Court | Upper Tribunal (Administrative Appeals Chamber) |
| Docket Number | CTC 3759 2014 |
| Appellant | AM |
IN THE UPPER TRIBUNAL Appeal No. CTC/3759/2014
ADMINISTRATIVE APPEALS CHAMBER
Before: Upper Tribunal Judge K Markus QC
The appeal is allowed in part: the decision of the First-tier Tribunal dated 14 April 2014 made under case number SC919/14/00021 was made in error of law in that it decided that the appellant was entitled to provision for a severely disabled child pursuant to section 9(5)(c) Tax Credits Act 2002 from 13 April 2013 rather than 6 April 2013.
The appeal in relation to the award of child tax credit from 11 December 2009 to 5 April 2013 is dismissed.
I do not set aside the First-tier Tribunal’s decision.
REASONS FOR DECISION
Introduction
- This is an appeal against a decision of the First-tier Tribunal confirming the decision of the Secretary of State refusing to include provision for her disabled child in her award of Child Tax Credit from 11 December 2009 to 12 April 2013 inclusive
- The First-tier Tribunal gave the appellant permission to appeal. In the light of the written submissions and documentary evidence, I directed an oral hearing which took place at Field House in London on 3 June 2015. The appellant appeared in person. The respondent was represented by Ms Galina Ward, counsel
- Before I turn to the facts and consider the issues in this appeal, it is helpful to summarise the relevant statutory provisions.
Statutory framework
- Adjudication of tax credit claims is governed by the Tax Credits Act 2002 (“TCA”) and the Tax Credits (Claims and Notifications) Regulations 2002 (“the Claims and Notifications Regulations”). A claim for tax credit is made under section 3(1) TCA. Section 5 limits an award to a maximum of one tax year, a new claim must be made for each subsequent tax year. HMRC makes an initial decision under section 14 TCA whether or not to award tax credit and, if so, the rate. Payment is made on that basis: section 24. At or around the end of the tax year, HMRC sends the claimant notice under section 17. The notice specifies the relevant circumstances held by HMRC and a claimant is required to make a declaration confirming that the circumstances are correctly recorded or notifying the respects in which they are not. Following the end of the tax year in question HMRC makes a final decision under section 18 as to whether the claimant was entitled to tax credit for that year and the amount.
- By regulation 11 of the Claims and Notification Regulations the section 17 declaration also serves as a new claim for the next tax year. This then leads to a further decision as to an award under section 14 and the process set out above starts again.
- Thus the scheme is that an initial section 14 decision awarding tax credit is made in response to a claim and payment is made accordingly; at the end of the tax year the section 17 procedure is used to check that the details held by HMRC are correct; and a final decision as to entitlement is made under section 18.
- The Tax Credits (Official Error) Regulations 2003 (“the Official Error Regulations”) are made pursuant to section 21 TCA. Regulation 2(1) defines “official error”:
‘“official error” means an error relating to a tax credit made by—
(a) an officer of the Board,
(b) an officer of the Department for Work and Pensions,
(c) an officer of the Department for Social Development in Northern Ireland, or
(d) a person providing services to the Board or to an authority mentioned in paragraph (b) or (c) of this definition, in connection with a tax credit or credits,
to which the claimant, or any of the claimants, or any person acting for him, or any of them, did not materially contribute, excluding any error of law which is shown to have been an error by virtue of a subsequent decision by a Social Security Commissioner or by a court;’
- Regulation 3 provides:
‘(1) A decision under section 14(1), 15(1), 16(1), 18(1), (5), (6) or (9), 19(3) or 20(1) or (4) may be revised in favour of the person or persons to whom it relates if it is incorrect by reason of official error, subject to the following paragraphs.
(2) In revising a decision, the officer or person in question need not consider any issue that is not raised by the application for revision by the claimant or claimants or, as the case may be, did not cause him to act on his own initiative.
(3) A decision mentioned in paragraph (1) may be revised at any time not later than five years after the date of the decision.’
- The amount of child tax credit includes an amount for a child who is disabled, and an additional amount for a child who is severely disabled: section 9(5)(c) TCA. Those conditions are satisfied if circumstances specified in regulation 8 of the Child Tax Credit Regulations 2002 apply, including that the care component of disability living allowance (DLA) is payable in respect of the child and, in respect of severe disability, the highest rate of the care component of DLA is payable in respect of him. In this decision I refer to this amount as “the disabled child element”.
Background facts
- The appellant had made a joint claim, with her husband, for working tax credit and child tax credit. The award of child tax credit included the disabled child element for one of her children, D. Upon the death of the appellant’s husband the joint award ended on 10 December 2009 and on 12 January 2010 the appellant made a new claim as a single parent which was treated as made on 11 December 2009. On her claim form the appellant indicated that D was in receipt of the highest rate of the care component of DLA. HMRC’s computer did not pick up this information from the claim form
- On 21 January 2010 the appellant was sent a notice of an award of tax credit (Form TC602) from 12 December 2009, made under section 14 TCA. This did not include the disabled child element of child tax credit. HMRC has not been able to provide a copy of the notice as such notices are generated automatically from information held by HMRC and sent to claimants. However, HMRC provided redacted copies of award notices sent to other claimants (which had been put before the First-tier Tribunal in other appeals) to show what such a notice looks like. These copies included a notice where there was no disabled child and a notice where there was such a child. In the former the notice contained no information about children who qualified for the disabled child element and in the latter the notice set out the number of children who so qualified. The appellant recognised these notices and agreed that she had been provided with a similar notice. As a result of the incorrect information held by HMRC, the notice sent to the appellant would have been of the former type. The front page of the notice included the instruction “Please check the details on this form and tell us if anything is wrong, missing or incomplete.” The instruction was repeated on the next page.
- Along with the section 14 award notice, the appellant was sent a check list on form TC602(SN). Samples have been provided by HMRC and the appellant agrees that she received these. The checklist...
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