Her Majesty's Revenue and Customs v MB: [2018] UKUT 162 (AAC), Judge Jacobs, 8 May 2018
In Her Majesty's Revenue and Customs v MB: [2018] UKUT 162 (AAC), Judge Jacobs, 8 May 2018, the Upper Tribunal considered the question of whether a step child was a child of a ChB claimant for the purposes of the definition of ‘member of the family’ in Article 1(i) of Regulation 883/2004, which provides, in so far as it is material:
‘(1) (i) any person defined or recognised as a member of the family or designated as a member of the household by the legislation under which benefits are provided;
(ii) with regard to benefits in kind pursuant to Title III, Chapter 1 on sickness, maternity and equivalent paternity benefits, any person defined or recognised as a member of the family or designated as a member of the household by the legislation of the Member State in which he resides;
(2) If the legislation of a Member State which is applicable under subparagraph (1) does not make a distinction between the members of the family and other persons to whom it is applicable, the spouse, minor children, and dependent children who have reached the age of majority shall be considered members of the family; …’
The claimant, MB, was Polish and had been in the UK since February 2015 as a worker. His wife lived in Poland with two children and received an award of Polish family benefits. One was the claimant’s biological son. The other was his step son. MB made a claim for ChB for both children which was refused. A FTT allowed the claimant’s appeal, holding that the UK was the competent State for paying ChB to MB in respect of the children. The FTT’s decision included a finding that the step son was a ‘member of the family’ of the claimant - which was a requirement under Article 67, and defined in Article 1(i) - because he was part of the claimant's household, and ‘this could include related people living together as a family even if they were not necessarily blood relatives.’ HMRC appealed the decision. UT Judge Jacobs, allowed the appeal and set the FTT’s decision aside. He held that a step child did not come within the definition in Article 1(i) for the following reasons.
- As the ChB legislation does not depend on a person being a member of a family or a household (SSCBA 1992, s.143), the EU definition of a family member in Head (2) applied. While a step child would appear to be a ‘minor child’ and so within the definition, it had to be read in the context of Article 67, which dealt with a person’s entitlement and so was linked to that person’s family members.
- Head (2) also provided that ‘the spouse, minor children, and dependent children … shall be considered members of the family’. That meant it had to be ‘the claimant’s spouse, minor children, and dependent children’ and could not be read as ‘any minor children’. In other words, the children must be the claimant’s children.
- While this reasoning reduced the scope of the application of Regulation 388/2004 for children to one based on biological or legal relationships, Judge Jacobs drew attention to the fact that the same was true for spouses, as the definition referred to spouses and not others who were in some equivalent form of relationship. This narrow reading could be contrasted with the citizenship Directive 2004/38, where the relationships covered are defined more widely.
- Judge Ward had adopted a similar approach to Regulation 884/2004 in E. KT v Commissioners for Her Majesty’s Revenue and Customs [2013] UKUT 151 (AAC), though the case was decided under the different wording in Regulation 1408/71.
Having concluded that ChB could not be paid to the claimant’s step son, Judge Jacobs went on to consider the position of MB’s biological son. While he was entitled to ChB as a ‘minor child’ of the claimant, Judge Jacobs held that the effect of Article 68 was that as family benefits were already in payment for the child in Poland, ChB could only be used as top-up to the Polish family benefits. The evidence showed that the amount of the Polish award was in fact higher than ChB. As there was nothing to top-up, this meant that no ChB was payable to the claimant for his biological child either.
