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Update targeted childcare tax credit criteria (#1605)
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‎changelog.d/1065.md‎

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- Updated targeted childcare entitlement tax credit criteria to match historical and current regulations.

‎policyengine_uk/parameters/gov/dfe/targeted_childcare_entitlement/income_limit/tax_credits.yaml‎

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description: The Department for Education qualifies recipients of the Working Tax Credit or Child Tax Credit for targeted childcare entitlement if their income does not exceed this threshold.
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description: The Department for Education applies this income threshold to tax credit routes into targeted childcare entitlement.
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metadata:
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unit: currency-GBP
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unit: currency-GBP
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period: year
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label: Income limit for tax credit recipients to access benefit-targeted free childcare
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label: Targeted childcare entitlement tax credit income limit
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reference:
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- title: The Local Authority (Duty to Secure Early Years Provision Free of Charge) Regulations 2014, part 1.2.b
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- title: The Local Authority (Duty to Secure Early Years Provision Free of Charge) Regulations 2014
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href: https://www.legislation.gov.uk/uksi/2014/2147/regulation/1/made
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# In part 1.2.b of regulation 2014, they mentioned "Part 1 of the Tax Credits Act 2002(8)" for tax credit criteria. Part 1.1 of the Tax Credits Act 2002(8) explains that tax credit is known as child tax credit and working tax credit.
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- title: Tax Credits Act 2002(8) - part 1
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href: https://www.legislation.gov.uk/ukpga/2002/21/section/1
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- title: 15 hours free education and childcare for 2-year-olds
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href: https://www.gov.uk/help-with-childcare-costs/free-childcare-2-year-olds-claim-benefits?step-by-step-nav=f237ec8e-e82c-4ffa-8fba-2a88a739783b
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- title: The Local Authority (Duty to Secure Early Years Provision Free of Charge) (Amendment) Regulations 2018
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href: https://www.legislation.gov.uk/uksi/2018/146/regulation/2/made
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values:
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2014-01-01: 16_190
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2014-01-01: 16_190

‎policyengine_uk/parameters/gov/dfe/targeted_childcare_entitlement/qualifying_criteria.yaml‎

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description: The Department for Education designates these variables that determine qualification for targeted childcare entitlement beyond qualifying benefits.
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metadata:
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reference:
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- title: Documenation for free education and childcare for 2-year-olds
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href: https://www.gov.uk/help-with-childcare-costs/free-childcare-2-year-olds
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- title: The Local Authority (Duty to Secure Early Years Provision Free of Charge) Regulations 2014
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href: https://www.legislation.gov.uk/uksi/2014/2147/regulation/1
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- title: The Local Authority (Duty to Secure Early Years Provision Free of Charge) (Amendment) Regulations 2018
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href: https://www.legislation.gov.uk/uksi/2018/146/regulation/2/made
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- title: Free education and childcare for 2 year olds if you get extra support
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href: https://www.gov.uk/help-with-childcare-costs/free-childcare-2-year-olds-extra-support
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period: year
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unit: program
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label: Qualifying criteria for targeted childcare entitlement
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values:
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2014-01-01:
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- meets_working_tax_credit_criteria_for_targeted_childcare_entitlement
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2018-01-01:
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- meets_universal_credit_criteria_for_targeted_childcare_entitlement
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- meets_child_tax_credit_criteria_for_targeted_childcare_entitlement
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- working_tax_credit_run_on
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2026-01-01:
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- meets_universal_credit_criteria_for_targeted_childcare_entitlement
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- meets_tax_credit_criteria_for_targeted_childcare_entitlement

‎policyengine_uk/tests/policy/baseline/gov/dfe/targeted_childcare_entitlement/meets_child_tax_credit_criteria_for_targeted_childcare_entitlement.yaml‎

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- name: Child Tax Credit without Working Tax Credit qualifies from the 2018 amendment
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period: 2019
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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child_tax_credit: 1
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tax_credits_applicable_income: 16_190
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output:
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meets_child_tax_credit_criteria_for_targeted_childcare_entitlement: true
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- name: Child Tax Credit with Working Tax Credit does not meet the 2018 criterion
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period: 2019
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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child_tax_credit: 1
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working_tax_credit: 1
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tax_credits_applicable_income: 16_190
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output:
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meets_child_tax_credit_criteria_for_targeted_childcare_entitlement: false
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- name: Child Tax Credit over the income limit does not qualify
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period: 2019
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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child_tax_credit: 1
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tax_credits_applicable_income: 16_191
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output:
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meets_child_tax_credit_criteria_for_targeted_childcare_entitlement: false

‎policyengine_uk/tests/policy/baseline/gov/dfe/targeted_childcare_entitlement/meets_tax_credit_criteria_for_targeted_childcare_entitlement.yaml‎

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- name: Tax credit criteria include Working Tax Credit before the 2018 amendment
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period: 2017
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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meets_working_tax_credit_criteria_for_targeted_childcare_entitlement: true
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output:
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meets_tax_credit_criteria_for_targeted_childcare_entitlement: true
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- name: Tax credit criteria include Child Tax Credit after the 2018 amendment
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period: 2019
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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meets_child_tax_credit_criteria_for_targeted_childcare_entitlement: true
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output:
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meets_tax_credit_criteria_for_targeted_childcare_entitlement: true
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- name: Tax credit criteria are inactive from 2026
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period: 2026
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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meets_child_tax_credit_criteria_for_targeted_childcare_entitlement: true
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output:
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meets_tax_credit_criteria_for_targeted_childcare_entitlement: false

‎policyengine_uk/tests/policy/baseline/gov/dfe/targeted_childcare_entitlement/meets_working_tax_credit_criteria_for_targeted_childcare_entitlement.yaml‎

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- name: Working Tax Credit qualifies before the 2018 amendment
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period: 2017
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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working_tax_credit: 1
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tax_credits_applicable_income: 16_190
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output:
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meets_working_tax_credit_criteria_for_targeted_childcare_entitlement: true
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- name: Child Tax Credit does not meet the original Working Tax Credit criterion
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period: 2017
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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child_tax_credit: 1
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tax_credits_applicable_income: 16_190
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output:
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meets_working_tax_credit_criteria_for_targeted_childcare_entitlement: false
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- name: Working Tax Credit over the income limit does not qualify
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period: 2017
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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working_tax_credit: 1
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tax_credits_applicable_income: 16_191
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output:
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meets_working_tax_credit_criteria_for_targeted_childcare_entitlement: false

‎policyengine_uk/tests/policy/baseline/gov/dfe/targeted_childcare_entitlement/targeted_childcare_entitlement_eligible.yaml‎

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- name: Working Tax Credit route qualifies before the 2018 amendment
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period: 2017
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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income_support: 0
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jsa_income: 0
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esa_income: 0
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guarantee_credit: 0
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meets_working_tax_credit_criteria_for_targeted_childcare_entitlement: true
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extended_childcare_entitlement_eligible: false
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output:
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targeted_childcare_entitlement_eligible: true
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- name: Ordinary Working Tax Credit no longer qualifies after the 2018 amendment
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period: 2019
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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income_support: 0
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jsa_income: 0
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esa_income: 0
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guarantee_credit: 0
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meets_working_tax_credit_criteria_for_targeted_childcare_entitlement: true
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meets_universal_credit_criteria_for_targeted_childcare_entitlement: false
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extended_childcare_entitlement_eligible: false
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output:
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targeted_childcare_entitlement_eligible: false
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- name: Working Tax Credit run-on qualifies after the 2018 amendment
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period: 2019
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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income_support: 0
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jsa_income: 0
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esa_income: 0
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guarantee_credit: 0
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meets_universal_credit_criteria_for_targeted_childcare_entitlement: false
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working_tax_credit_run_on: true
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extended_childcare_entitlement_eligible: false
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output:
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targeted_childcare_entitlement_eligible: true
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- name: Child Tax Credit without Working Tax Credit qualifies after the 2018 amendment
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period: 2019
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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income_support: 0
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jsa_income: 0
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esa_income: 0
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guarantee_credit: 0
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meets_universal_credit_criteria_for_targeted_childcare_entitlement: false
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meets_child_tax_credit_criteria_for_targeted_childcare_entitlement: true
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extended_childcare_entitlement_eligible: false
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output:
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targeted_childcare_entitlement_eligible: true
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- name: Child Tax Credit no longer qualifies from 2026
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period: 2026
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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income_support: 0
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jsa_income: 0
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esa_income: 0
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guarantee_credit: 0
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meets_universal_credit_criteria_for_targeted_childcare_entitlement: false
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meets_child_tax_credit_criteria_for_targeted_childcare_entitlement: true
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extended_childcare_entitlement_eligible: false
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output:
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targeted_childcare_entitlement_eligible: false
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- name: Universal Credit still qualifies from 2026
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period: 2026
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input:
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people:
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person:
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age: 30
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benunits:
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benunit:
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members: [person]
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income_support: 0
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jsa_income: 0
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esa_income: 0
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guarantee_credit: 0
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meets_universal_credit_criteria_for_targeted_childcare_entitlement: true
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extended_childcare_entitlement_eligible: false
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output:
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targeted_childcare_entitlement_eligible: true

‎policyengine_uk/variables/gov/dfe/targeted_childcare_entitlement/meets_child_tax_credit_criteria_for_targeted_childcare_entitlement.py‎

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from policyengine_uk.model_api import *
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class meets_child_tax_credit_criteria_for_targeted_childcare_entitlement(Variable):
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value_type = bool
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entity = BenUnit
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label = "meets Child Tax Credit criteria for targeted childcare entitlement"
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definition_period = YEAR
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reference = (
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"The Local Authority (Duty to Secure Early Years Provision Free of Charge) "
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"(Amendment) Regulations 2018, regulation 2(a)(i)"
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)
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def formula(benunit, period, parameters):
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p = parameters(period).gov.dfe.targeted_childcare_entitlement
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child_tax_credit = benunit("child_tax_credit", period) > 0
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working_tax_credit = benunit("working_tax_credit", period) > 0
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applicable_income = benunit("tax_credits_applicable_income", period)
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return (
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child_tax_credit
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& ~working_tax_credit
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& (applicable_income <= p.income_limit.tax_credits)
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)

‎policyengine_uk/variables/gov/dfe/targeted_childcare_entitlement/meets_tax_credit_criteria_for_targeted_childcare_entitlement.py‎

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def formula(benunit, period, parameters):
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p = parameters(period).gov.dfe.targeted_childcare_entitlement
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tax_credits = add(benunit, period, ["child_tax_credit", "working_tax_credit"])
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tax_credits_applicable_income = benunit("tax_credits_applicable_income", period)
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# Check Tax Credits eligibility
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# Legislation source for total (applicable) income limit:The Local Authority Regulations 2014, part 1.2.b
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# https://www.legislation.gov.uk/uksi/2014/2147/regulation/1/made
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# Reference for applicable income: The Tax Credits (Definition and Calculation of Income) Regulations 2002 s. 3
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return (tax_credits > 0) & (
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tax_credits_applicable_income <= p.income_limit.tax_credits
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)
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tax_credit_criteria = [
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"meets_working_tax_credit_criteria_for_targeted_childcare_entitlement",
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"meets_child_tax_credit_criteria_for_targeted_childcare_entitlement",
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"working_tax_credit_run_on",
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]
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active_tax_credit_criteria = [
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variable
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for variable in tax_credit_criteria
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if variable in p.qualifying_criteria
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]
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if not active_tax_credit_criteria:
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return False
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return add(benunit, period, active_tax_credit_criteria) > 0

‎policyengine_uk/variables/gov/dfe/targeted_childcare_entitlement/meets_working_tax_credit_criteria_for_targeted_childcare_entitlement.py‎

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from policyengine_uk.model_api import *
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class meets_working_tax_credit_criteria_for_targeted_childcare_entitlement(Variable):
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value_type = bool
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entity = BenUnit
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label = "meets Working Tax Credit criteria for targeted childcare entitlement"
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definition_period = YEAR
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reference = (
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"The Local Authority (Duty to Secure Early Years Provision Free of Charge) "
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"Regulations 2014, regulation 1(2)(b)"
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)
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def formula(benunit, period, parameters):
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p = parameters(period).gov.dfe.targeted_childcare_entitlement
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working_tax_credit = benunit("working_tax_credit", period) > 0
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applicable_income = benunit("tax_credits_applicable_income", period)
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return working_tax_credit & (applicable_income <= p.income_limit.tax_credits)

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