Hi,

Will the TCO send a final notice for a nil award?

Client has an award letter saying no entitlement to WTC. It is based on previous year's income and client is likely to be entitled if award was based on current year.

It might be advantageous for him not to have the WTC now as it potentially increases entitlement to other means-tested benefits. I say potentially as this all hangs on another decision regarding a qualifying benefit.

The Tax Credit Act talks about a final notice being issued "where tax credit has been awarded" (s.17(1)) but it appears they do have the power to make an award of nil (s.14(3)). So I'm not sure what they will do come April 2009. Anybody know?

Sue

Unless I'm missing something, this sounds like a straightforward change in circs regarding income.

If the change is reported now the entitlement should be recalculated for the year and there might be an ongoing award. If it is reported during the annual declaration period, then any award for the year will be shown on the final notice and paid as a lump sum which, if memory serves correctly, is treated as capital and ignored for 52 weeks.

However, I'm wondering if the deprivation rules might apply if your client knows that income in the form of WTC is available and doesn't apply for it? I sometimes suggest that people consider delaying a notificaiton of a decrease income as there is more benefit in a lump sum than in extra entitlement that is swallowed up by the HB taper, but I'm always wary of the possibility of deprivation.

But I'm not sure there will be an annual declaration if there is a nil award - that was my question.

If the initial notice is a TC602(A) then i would say so since, as you say, it would be nil award under s.14(3) and s.17 is the process for checking the s.14 initial decision. If its anything other than a 602(A), I think I would look into the status of the initial notice.

Thanks for that.

Don't know if this helps: My youngest is 21 and left school at 16, i still get a final notice every year for a nil amount, X2 in fact, one for me and one for my partner.

Drives me mad but they won't stop sending them!!!!

So yes your client, based on my experience, should get a final notice for the nil award.

Reminds me of the Jasper Carrot sketch about the Volvo.

Thanks!

One of my clients was told that she had been overpaid TC but could not appeal against her overpayment - she was told that she could only appeal against 'decisions on entitlement' or 'notices reflecting decisions on entitlement'. Eventually I found, among her papers, the award to nil TC for that year and I could start a formal appeal against it. Whether my request to appeal is going to be processed or goes straight in the dustbin (as it seems it's their procedure) it's another matter...
Giuseppina