Important information about the new tax credits and your housing benefit and council tax benefit claim
In April 2003 the government introduced two new tax credits that will be administered by the Inland Revenue; Child Tax Credit and Working Tax Credit.
Child tax credit is a single credit aimed at families with children. It provides a single seamless system of income-based support for all families with children regardless of whether you or your partner are employed.
To be eligible for child tax credit you must simply be responsible for at least one child aged under 16, or one young person aged 16 to 19 who is in full-time non-advanced education or registered with the Careers Service or Connexions.
All eligible families can claim Child Tax Credit. The amount you receive will depend on your family income.
The Working tax credit is intended to make work pay more than benefits. It can help you move from Income Support, Jobseekers Allowance (Income Based) or the Minimum Income Guarantee into work.
You should claim Working tax credit if you or your partner have a job where you normally work at least 16 hours per week, and any of these apply to you:
Or, you can claim working tax credit if these apply:
In these circumstances you must be aged 25 or over and have a job where you normally work at least 30 hours per week.
Depending on your circumstances, you or your partner may qualify for extra elements of Working tax credit. You may also be eligible for help with childcare costs when you make a claim.
If you are part of a couple (either married or living together as husband and wife), you will have to make a joint claim. Your entitlement will depend on your joint income. This is because tax credits are intended to meet the needs of the family and reflect the circumstances and income of the family rather than the individual.
Claims for tax credits can be made to the Inland Revenue, using either:
If you want to find out more about child tax credit and working tax credit, you can:
Lines are open: 8am-8pm every day, except Christmas Day, Boxing Day, New Year's Day and Easter Sunday.
A tax credit award will run from the date of the claim (or in some cases it can be backdated) to the end of the tax year. If your claim is made in advance of the start of the tax year your award is for the whole of the tax year.
The claim will only end before the end of the tax year if you are no longer eligible for a tax credit, e.g. if,
Your tax credit award will be broadly based on your gross annual taxable income, that is, your income for the relevant tax year, before any tax is deducted.
If you are receiving housing benefit or council tax benefit and you have a change in circumstances this may affect the amount of housing benefit or council tax benefit you get. A change in circumstances may be because you have started to get a tax credit or if the amount of your tax credit changes.
The change may result in you getting less housing benefit or council tax benefit. If you do not report this change within one month, you may be overpaid benefit and will have to pay it back.
The rules for reporting a change in circumstances to the Inland Revenue for tax credit purposes are different to the rules for reporting a change of circumstances for housing benefit and council tax benefit. The Inland Revenue allows you three months in which to report a change of circumstances to them. For housing benefit and council tax benefit you only have one month in which to report the change to us.
So, if you are on housing or council tax benefit remember that you must report a change in your circumstances (including if you start or stop getting a tax credit, or the amount of your tax credit changes) to us within one month of the change. You should also report the change in circumstances to the Inland Revenue.
Page Last Updated: 31 December 2007