Social Security Case Law - Autumn 2024

Headnote

A claimant whose family lives in a different member state in the EU is entitled to make a single claim for Working Tax Credits and a joint claim for Working Tax Credits.

Background

The claimant was a Polish national living and working in the United Kingdom, he made a claim for Tax Credits in April 2018 while his wife and children resided in Poland. The claimant included details of his children in his claim but did not include any details of his wife. In August 2018, HMRC refused the claim citing the appellant failed to provide information that would enable it to determine whether he was entitled as a single person or entitled as someone responsible for qualifying children. The claimant asked for the decision to be revised via mandatory reconsideration, but it remained unchanged. It was confirmed that his claim was received in June 2018, and was rejected in August 2018 because HMRC did not receive a reply to their letter seeking further information, and that they would not accept a joint claim where one member of the couple lives outside the UK unless exceptions apply.

At appeal, the tribunal found that the claimant had in fact provided information about the factual circumstances of his children and wife in correspondence on the phone and was therefore entitled to receive an award of Tax Credits on a joint basis from the original date in June 2018.

HMRC appealed the decision to the Commissioner.

Legal Issue

The Commissioner considered whether the tribunal was correct in stating that a claim made on a basis that suggested it was a single claim under the Tax Credit Act 2022 could be progressed as a joint claim. There were also two further issues that the Commissioner was asked to clarify in relation to the legislation:

• Under Tax Credit legislation you are unable to make a joint claim where one member lives outside of the UK.
• EU legislation requires member states to permit EU nationals exercising ‘free movement’ rights access to family benefits when a member of a couple is residing in a different member state.

Relevant Legislation

• Regulation 9(3), The Social Security Commissioners (Procedure) Regulations (NI) 1999
• Section 3 & 14, The Tax Credits Act 2002
• Article 1(z) & Article 67 of Regulation (EC) 883/2004
• The Tax Credits (Claims and Notifications) Regulations 2002
• Preamble to Regulation (EC) 987/2009
• The Tax Credits (Residence) Regulations 2003

Relevant Case Law

• R(TC)1/07
• CTC/2599/2019
• CTC/3864/2004
• ML v Department for Communities [2021] NI Com 47

Decision

The Commissioner confirmed that the EU Regulations disapplied the UK legislation that required the claimant’s partner to also reside in the UK while he was exercising his ‘free movement’ rights. This meant that the claimant was entitled to make a claim for family benefits, i.e. Child Tax Credits even with his wife and children residing in Poland. However, the conditions for Working Tax Credit were different as the entitlement is linked to qualifying work rather than responsibility for children – it is not a family benefit. Therefore, the claimant was able to make a single person claim for Working Tax Credits and the Commissioner granted the appeal stating that the tribunal had erred in law. The Commissioner also alluded to the interchangeability and discretion of the tribunal to change a single claim to a joint claim where subsequent information and evidence points to it.