Child benefit post April 06 query

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  • #22930
    Anonymous
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    We’ve been having discussions about the April 06 changes to Child Benefit because circular HB/CTB A6/2006 does not mention anything about child benefit ceasing when a person starts work yet we’ve had several cases where child benefit has ended before a terminal date due to the young person starting work.

    So in relation to HB/CTB if a dependant child turned 16 in May 2006 and then finished compulsory education in July 06 they would normally have child benefit paid, and be regarded as a dependant person on the benefit claim, until Sunday 03/09/06 (end of week that includes the relevant terminal date of 31/08/06).

    However if the dependant person starts work on Wednesday 09/08/06 would you end child benefit and the dependant person status on Sunday 13/08/06 (Sunday following start of work) or leave both on claim until Sunday 03/09/06? (end of week that includes the relevant terminal date of 31/08/06).

    #10213
    Mark
    Participant

    This is one of those oddities that makes HB so special…..(that’s special in the sense of “how is anyone supposed to remember this stuff?)

    Child Benefit is payable for Children (anyone aged 0-15) and Qualifying Young Persons (only certain people aged 16-19). The definition of a Qualifying Young Person is in Regs 3, 4, 5, 6 and 7 of the Child Benefit (General) Regulations 2006 (SI2006/223).

    Reg 7 of those regulations says that regardless of the terminal date rules you can’t get Child Benefit for any Qualifying Young Person for a week in which they are “engaged in remunerative work”. Remunerative work is defined in Reg 1 of those regulations as meaning paid work of 24hrs per week or more (i.e. different to the 16hr remunerative work rule in HB).

    So that’s why you’re seeing cases where the Child Benefit is ending before the terminal date is reached.

    But there’s more to it than this.

    HB Reg 19 (and all the equivalent variants for pensioners and CTB) is the provision that dictates whether 16-19 year olds count as dependants or not. This was amended by SI2006/718 to say that a person of prescribed description for the purposes of s137(1) of the Social Security Contributions and Benefits Act 1992 is “a person who falls within the definition of a qualifying young person in section 142 of the Act”.

    The Child Benefit (General) Regulations 2006 make it pretty clear that Qualifying Young Persons who are working remuneratively are still defined as Qualifying Young Person’s – it’s just that no Child Benefit is paid for them.

    If I’m right about this so far, this must mean that all “Qualifying Young Persons” count as dependants in HB and CTB regardless of whether no child benefit is being paid for them because of the remunerative work exclusion.

    So my conclusion is that if you see Child Benefit ending before a terminal date is reached, and you know that this is because the Qualifying Young Person is in remunerative work – then you should exclude Child Benefit income from the assessment (they won’t be getting any) but include the Qualifying Young Person as a dependant for the purposes of calculating the applicable amount up till the relevant terminal date is reached.

    To answer the original question as fully as I can, one further thing is worth pointing out – the “no Child Benefit if they’re working remuneratively” rule does not appear to apply to 16 year old school leavers. This is because their terminal date isn’t set by Reg 7 of the Child Benefit regs – it’s set by Reg 4 instead and this has no remunerative work exclusion rule in it. I assume, therefore, that child benefit will never end before the 31st Aug following the 16th birthday regardless of anything the young person is doing.

    #10214
    Anonymous
    Guest

    Cheers Mark, that makes much more sense now.

    Thanks again for replying, Rhys

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