[2025] UKUT 186 (AAC)

The Secretary of State’s grounds of appeal which were before the FTT for being given permission to appeal to the Upper Tribunal are the same grounds on which she now relies before the Upper Tribunal.

The material parts of those grounds are worth setting out in full as they explain clearly, in my judgement, why the FTT went wrong in its analysis and thereby materially erred in law.

“B. THE STATUTORY SCHEME IN OVERVIEW

3.

Child benefit is a separate benefit governed by Part IX of the [SSCBA] Benefits Act……. Entitlement depends on a person being responsible for one or more children or qualifying young persons: see s.141 of the [SSCBA]. However, s.141 of the [SSCBA] must be read together with the Social Security (Administration) Act 1992 [(“the SSAA”)]: see s.177(2) of the [SSCBA] and s.192(2) of the [SSAA]. Section 13(1) of the [SSAA] provides that: “Subject to the provisions of this Act, no person shall be entitled to child benefit unless he claims it in the manner, and within the time, prescribed in relation to child benefit by regulations under section 5 above.”

4.

The Child Benefit and Guardian’s Allowance (Administration) Regulations 2003 SI 2003/492 (“the CB Administration Regulations”) were made (inter alia) in the exercise of the powers conferred by s.5 of the [SSAA]. They provide, subject to immaterial exceptions, that the time within which a claim for child benefit may be made “is 3 months beginning with any day on which, apart from satisfying the conditions for making the claim, the person making the claim is entitled to [child] benefit”: see reg.6(1). Regulation 15(1) of the CB Administration Regulations provides that an award of child benefit is generally made by HM Revenue and Customs (“HMRC”) for an indefinite period.

5.

Regulation 23 of the CB Administration Regulations applies to any person entitled to child benefit: see reg.23(1). Regulation 23(2)(a) provides that such a person must furnish in such manner and at such times as HMRC may determine such information or evidence as the HMRC may require for determining whether a decision on an award should be revised or superseded pursuant to the powers conferred on HMRC [pursuant to sections 50 and 53 of the Tax Credits Act 2002] by ss.9-10 of the Social Security Act 1998 [(“the SSA”)]). Regulation 23(3) provides that a person to whom reg.23 applies must furnish to HMRC such information and evidence as HMRC may require in connection with the payment of child benefit.

6.

Part 4 of the Child Benefit and Guardian’s Allowance (Decisions and Appeals) Regulations 2003 SI 2003/916 (“the CB (D&A) Regulations”) is headed: “Suspension andTermination”. Regulation 19 applies where HMRC require information or evidence for a determination of whether a decision awarding child benefit should be revised or superseded: see reg.19(1). Regulation 19(2) applies to a person who fails to comply with reg.23 of the CB Administration Regulations insofar as they relate to information, facts or evidence required by HMRC: reg.19(3)(c). A person to whom reg.19(2) applies must supply the information or evidence within a period of one month of being notified that he is required to do so: see reg.19(2)(a). Regulation 19(5) provides that HMRC may suspend the payment of child benefit to a person who fails to satisfy the requirements of reg.19(2).

7.

Regulation 20 is headed “Termination in cases of failure to furnish information or evidence”. It applies where child benefit has been suspended under reg.19(5) “and more than one month has elapsed since the first payment was so suspended”: reg.20(1)(b). Regulation 20(2) provides that HMRC “must decide that the person ceases to be entitled to the benefit or allowance from the date on which payment was suspended”.

C. THE APPROACH OF THE TRIBUNAL

8.

The issue in the Entitlement Appeal was whether the [claimant] was entitled to widowed parent’s allowance in the period from 29 July 2019 to 24 October 2021. That turned on whether the Appellant was entitled to child benefit in that period: see s.39A(2)(a) of the [SSCBA].

9.

It is common ground that the [the claimant]t was not in receipt of child benefit on and after 29 July 2019. In particular, HMRC wrote to the Appellant on 19 July 2019, informing him that: “We’ve stopped paying Child Benefit for your child”, and asking him for further information to confirm his entitlement to child benefit. He was informed that, unless the information requested was provided within one month of the date of HMRC’s letter, “you may lose some or all of your Child Benefit entitlement”. [This letter is at page 4 of Addition D to the FTT bundle].

10.

The FTT held that HMRC had made a decision, communicated by letter dated 23 March 2020, that the [claimant’s] “award [was] terminated on account of [him] not furnishing HMRC with information it has asked for”, and that HMRC had “made a decision to terminate the award of CB”. HMRC’s letter of that date stated in terms: “You are no longer entitled to Child Benefit… because you have not sent us theinformation we asked for on 18 July 2019”, and that payment had been stopped since 29 July 2019. [This letter is at page 5 of Addition F to the FTT bundle. The reference to ‘18 July 2019’ appears to be a typographical slip and should have read ’19 July 2019’.]

11.

Following that decision, the [claimant] made a further claim to HMRC for child benefit on 20 January 2022, and child benefit was once again awarded by HMRC with effect from 25 October 2021.

12.

The FTT held that the [claimant] met all of the conditions for entitlement to child benefit during the period of 29 July 2019 to 24 October 2021, even if he had not been in receipt of it…..

D. SUBMISSIONS

13.

In deciding that the [claimant] was entitled to child benefit in the period of 29 July 2019 to 24 October 2021, the FTT erred in law by failing to apply and give effect to reg.20(2) of the CB (D&A) Regulations, s.17(1) of the [SSA], and s.13(1) of the [SSAA]. By virtue of that error of law, the FTT erred in law in holding that the [claimant] was entitled to widowed parent’s allowance in the period of 29 July 2019 to 24 October 2021, and in allowing the Entitlement and Overpayments Appeals.

14.

First, the FTT erred in law in holding that the effect of HMRC’s decision communicated by letter dated 24 March 2020 was not to terminate the Appellant’s entitlement to child benefit with effect from 29 July 2019. The FTT was right to direct itself that there is a distinction between a person being entitled to a benefit and that benefit being in payment. A person entitled to child benefit may not be paid it for a number of reasons. However, the unambiguous effect of reg.20(2) of the CB (D&A) Regulations was to require HMRC to decide that the [claimant] “cease[d] to be entitled to [child] benefit … from the date on which payment was suspended”, i.e. 29 July 2019. HMRC made a decision to that effect on 24 March 2020.

15.

Second, HMRC’s decision under reg.20(2) of the CB (D&A) Regulations was a supersession decision for the purposes of s.10 of the [SSA]: see, in relation to analogous statutory provisions, R(H) 4/08 per Mr Commissioner Jacobs at §33; CH/2995/2006 per Mr Commissioner Rowland at §22. Accordingly, [subject to mandatory reconsideration] a right of appeal against that decision lay to the FTT under s.12(1) of the [SSA]. However, subject only to the provisions of Chapter II of Part 1 of the [SSA], HMRC’s termination decision was “final”: see s.17(1) of the [SSA]. The Secretary of State and the FTT in this appeal were therefore bound to proceed on the basis that HMRC’s extant decision was binding and that the [claimant] was not entitled to child benefit on and after 29 July 2019.

16.

Third, once the [claimant]’s entitlement to child benefit had ceased pursuant to HMRC’s termination decision under reg.20(2) of the CB (D&A) Regulations, entitlement to child benefit could only then arise if a further claim for that benefit was made to HMRC. That is the clear and unambiguous effect of s.13(1) of the [SSAA], which makes entitlement to child benefit conditional on making a claim for it: see Secretary of State for Work and Pensions v Nelligan [2004] 1 WLR 894 per Scott Baker LJ at §§13-15, §17, §25 (in relation to the analogous provision in s.1 of the [SSAA]). In the absence of a claim, therefore, it was immaterial that the other conditions of entitlement to child benefit in Part IX of the [SSCBA] were met by the Appellant. The FTT erred in law to the extent it held otherwise…

17.

Fourth, the [claimant] did make a further claim for child benefit in January 2022. However, the effect of s.13(1) of the [SSAA] and reg.6(1) of the CB Administration Regulations is that that claim could only be made for a past period of three months “which, apart from satisfying the conditions for making the claim, the person making the claim is entitled to [child] benefit”. Accordingly, the further claim made on 20 January 2022 did not confer an entitlement to child benefit in the period before 25 October 2021, from which HMRC awarded child benefit, and to the extent the FTT held otherwise, it erred in law. Further or alternatively, the date of entitlement under that further award was a matter for HMRC to determine under s.8(1) of the [SSA], and the FTT and the Secretary of State in this case were bound by it pursuant to s.17(1) of the [SSA].”

It is perhaps worth setting out remarks the FTT judge who had decided the appeals made having had sight of these grounds of appeal, when he gave the Secretary of State permission to appeal to the Upper Tribunal:

“I do wish to make the following remarks: while I can see that the DWP argues that HMRC made a decision to terminate AE’s claim for Child Benefit (CB) and stated that he was not entitled to it, I am not sure that this can be said to the final word on AE’s entitlement. It could, I think, be argued that yes - HMRC took a view on entitlement, declared that AE was not entitled and therefore could not be paid CB but if one (any person) considers underlying entitlement to CB and whether AE met the conditions of entitlement, it can be seen that he did. Whether HMRC decided that AE was entitled and could be paid is, I think, a separate matter. There are many people who may be ‘entitled’ to a benefit because they meet the conditions of entitlement to that benefit but for whatever reason, chose not to claim the benefit. Can it be said that such a person is not entitled to X benefit? I think rather it can be said that the person cannot be paid the benefit because they have not satisfied the relevant first-tier agency (FTA) e.g. HMRC or DWP, that they are entitled to X benefit. That might be because, for example, they have not submitted a valid claim for X benefit. However, I think it can still be said that the person is entitled to X benefit because irrespective of the view of the FTA, the person meets the conditions of entitlement. The next step to the road to payment of X benefit is for the person to satisfy the FTA of their entitlement which requires other things e.g. the submission of a valid claim for X benefit.”