Working Tax Credits

Working tax credits are part of the UK’s system of means-tested social security benefits designed to help individuals and families who are on low incomes.

Eligibility

You must be living in the UK to be able to claim working tax credits and working over a certain number of hours per week. If you’re 16 or over and working 16 or more hours a week, you might be able to claim working tax credits if you are responsible for a child or if you are disabled and are entitled to a related qualifying benefit, depending on your income.

If you’re 25 or over, working at least 30 hours a week and currently earning below £12,800 you might also be eligible for working tax credits and this includes those who may not have a child.

If you’re 50 or over, working at least 16 hours per week and you began your job within the last 3 months, you might also be entitled to claim working tax credits if you were in receipt of certain other benefits for at least 6 months prior to commencing your job.

How Much Money Might I Receive?

There are a number of elements which determine how much you might be entitled to in working tax credits. The tax credits system is quite complex and the amount you could receive may be comprised of both working tax credits and child tax credits.

However, for the current financial year – which is calculated from April 5, 2008 – the maximum amount of the basic element of working tax credit is £1,800. The actual amount you’ll receive will ultimately be determined by the amount of income you derive from your job.

Obviously, the higher your income, the less working tax credit you will receive. As for child tax credit, the maximum basic family element is £545 with up to an additional £2,085 for each child. You might be able to claim more than this if any of your children are disabled.

How Are the Payments Made?

Payments are made either weekly or once every 4 weeks and are paid directly into your bank or building society account or, alternatively, into a Post Office or National Savings account.

What if I’m Married or Live With a Partner?

In this situation, you should apply jointly for working tax credit. However, only one parent or partner can make a claim for child tax credit so you will need to decide which one of you should make the claim. If you’re unsure, your local Citizens' Advice Bureau can help you with this.

What If My Circumstances Change?

It is very important to notify HM Revenue & Customs of any change in your financial circumstances as they could affect the qualifying criteria. Too many people fail to notify HM Revenue & Customs and end up getting into financial difficulty because they eventually have to pay back any money to which they were not entitled because of a change in financial circumstances. In some cases, prosecution can also result if it’s deemed that you fraudulently accepted money to which you had no right.

How to Apply

If you think that you may be eligible to claim working tax credit/child tax credit, you should contact the Tax Credits helpline. Telephone calls to this number cost the same as a local call. Alternatively, you can pick up an application pack from your local Jobcentre Plus or benefits office.

Your local Citizens' Advice Bureau will also be able to help you with any queries you have regarding the tax credits system. They’ll also be able to assist you if you have been turned down for tax credits but wish to lodge an appeal against the decision if they feel you are eligible for financial help under the system.