The Tax Credits (Income Thresholds and Determination of Rates) Regulations 2002

2. Introductory Text

1. Citation, commencement and effect

3. 2. Interpretation

4. 3. Manner in which amounts to be determined for the purposes of section 7(1)(a) of the Act

5. 4. Social security benefits prescribed for the purposes of section 7(2) of the Act

6. 5. Amounts prescribed for the purposes of section 7(3)(a) and (b) of the Act

7. 6. Manner of determining the rate at which a person is, or persons are, entitled to a tax credit

8. 7. Determination of rate of working tax credit

9. Step 1 — finding the daily maximum rate for each element other than the child care element

   1. For each element of the tax credit (other than the...

10. Step 2 — finding the maximum rate for the relevant period for each element other than the child care element

    1. For each element of the tax credit to be so...

11. Step 3 — finding the income for the relevant period

    1. Find the income for the relevant period by using the...

12. Step 4 — finding the threshold for the relevant period

    1. Find the threshold for the relevant period using the following...

13. Step 5 — finding the amount of the reduction

    1. Find the amount which is 37% of the amount by...

14. Step 6 — reducing the elements of the tax credit (other than any child care element)

    1. If the amount found under Step 5 (rounded down to...

15. Step 7 — finding the actual weekly child care costs for the relevant period

    1. Find the relevant child care charges for the relevant period...

16. Step 8 — finding the actual child care costs for the relevant period

    1. Multiply the result of Step 7 by 52 N1 ×...

    2. Here N1 and N2 have the same meanings as in...

    3. The result of this step is the amount of actual...

17. Step 9 — finding the prescribed maximum child care costs for the relevant period

    1. Divide whichever of the maxima in regulation 20(3) of the...

    2. The result of this is the prescribed maximum child care...

18. Step 10 — finding the child care element for the period

    1. Take the lesser of the results of Steps 8 and...

    2. Multiply that figure by 70% and round the result up...

    3. The result of this step is the maximum rate of...

19. Step 11 — reducing the elements of the tax credit (including any child care element)

    1. If the amount found under Step 5 (rounded down to...

20. Step 12 — finding the rate for the relevant period

    1. Add together— (a) the total of the amounts found under...

    2. This is the rate for the relevant period.

    3. 8. Determination of rate of child tax credit

21. Step 1 — finding the daily maximum rate for each element

    1. For each element of the tax credit to be included...

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

    1. For each element of the tax credit to be so...

23. Step 3 — finding income for the relevant period

    1. Find the income for the relevant period by using the...

24. Step 4 — finding the threshold for the relevant period

    1. Find the amount produced by the following formula— £ 13...

    2. The threshold for the relevant period is—

25. Step 5 — finding the amount of the reduction of the elements of the tax credit (other than the family element)

    1. Find the amount (if any) which is 37% of the...

26. Step 6 — reducing the elements of the tax credit (other than the family element)

    1. If the amount found under Step 5 (rounded down to...

27. Step 7 — reducing the elements of the tax credit (other than the family element) to nil

    1. If the amount found under Step 5 (rounded down to...

28. Step 8 — finding the amount of the reduction of the family element

    1. Find the amount (if any) which is 6.67% of the...

    2. where— “X” is the amount found in accordance with Step...

29. Step 9 — finding “X” for the purposes of Step 8

    1. Find “X” using the following formula— £ 50 , 000...

30. Step 10 — reducing the family element

    1. Deduct any amount found under Step 8 (rounded down to...

31. Step 11 — finding the rate for the relevant period

    1. Add together— (a) the total of the amounts found under...

    2. This is the rate for the relevant period.

    3. 9. Cases in which there is no rate of tax credit

32. Signature

33. Explanatory Note