You may be entitled to tax credits if you work, or if you have dependent children.
Tax credits are payments made by Her Majesty's Revenue and Customs (HMRC). There are two types of tax credit:
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Working Tax Credit (WTC) is a means-tested payment for working people on a low income.
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Child Tax Credit (CTC) is a means-tested payment for people with dependent children, whether in or out of work.
The amount paid depends on your income and other circumstances. If you are married or living with a partner of the opposite sex, your partner's income will be taken into account.
Working Tax Credit
Who can claim Working Tax Credit (WTC)?
To claim WTC, you must have a fairly low income. You may be employed or self-employed.
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If you have a disability or children: you must be at least 16 years old, and work at least 16 hours per week.
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Workers who don't have a disability or children: must normally be at least 25 years old and working at least 30 hours per week to qualify.
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If you are aged 50 or over: there are special rules to allow you to qualify, if you work at least 16 hours a week and you received a qualifying benefit (including Incapacity Benefit, Severe Disablement Allowance or Income Support) for at least 26 weeks before starting work.
How low does my income have to be?
To get WTC, you must have a fairly low income. The amount of income you can have depends on your individual circumstances. Certain types of income for example, Disability Living Allowance (DLA) is not counted when calculating entitlement to tax credits.
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A single disabled person with no children, working 16 to 29 hours a week, may be entitled to WTC if their gross income is less than about £17,620. (Gross income means income before tax and National Insurance.)
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A single disabled person with no children, working at least 30 hours a week, may be entitled to WTC if their gross income is less than £19,605.
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A disabled worker who has a partner (and they jointly work at least 30 hours and one partner works at least 16 hours) may be entitled to WTC, if the couple's joint income is less than £24,375.
Note: Higher figures apply in some circumstances, for example if you have childcare costs.
If you aren't sure whether you qualify for Working Tax Credit, you can get advice by:
Child Tax Credit
You can get Child Tax Credit if:
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you have at least one child under 16 (or under 19 and in full-time non-advanced education, such as 'A' Level); and
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your gross income is less than £57,400 or less per year. If you have a baby under one year old, you may get CTC even if your income is higher than this.
It doesn't matter whether or not anyone in your family is working.
If you are claiming Incapacity Benefit, Income Support or income-based Jobseekers Allowance, which include amounts for children, these elements will be transferred to Child Tax Credits by October 2010.
More information on Incapacity Benefit and Income Support.
Applying for Tax Credits
There is one application pack to cover both Working Tax Credit and Child Tax Credit. You can get an application pack by telephoning:
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0845 300 3900 if you live in Great Britain
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0845 603 2000 if you live in Northern Ireland.
You can also check your entitlement online at the HMRC website.
Applications can be backdated for up to three months.
How much are Tax Credits worth?
The amount paid depends on your income and other circumstances. Please note that WTC and / or CTC are counted as income for both Housing Benefit and Council Tax Benefit.
To work out the maximum amount of WTC and / or CTC that you can get, different elements are added together according to your circumstances.
You receive the maximum award if your gross income is below the threshold. The threshold is £6,420 per year, if you are entitled to WTC; and £16,040 per year if you are entitled to CTC only. If your income is above the threshold, you will get a reduced amount of tax credits.
Extra money for disabled people
You may be able to get extra money included in your tax credits if you, or your partner or child, has a serious sight problem or other disability.
1. You can have a disability element included in your WTC if you (or your partner) are a disabled worker.
The person working must:
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have a disability that reduces their work prospects; and
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get a qualifying benefit, such as Disability Living Allowance, or have recently been getting a qualifying benefit, for instance Incapacity Benefit; or
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become sick or disabled while in work and be eligible under the fast track route.
2. You can have a severe disability element included in your Working Tax Credit, if you or your partner get the highest rate of DLA care component or higher rate Attendance Allowance.
3. You can have a disabled child element included in your Child Tax Credit for each child who gets DLA (any rate) or is registered blind.
4. You can have a severely disabled child element included in your Child Tax Credit for each child who gets the highest rate of DLA care component.
Changes of circumstance
The following changes must be notified to HMRC. This must be done within one month of the date the change occurred or, if later, from the date you realised there had been a change.
Changes in the adults heading your household, for example if you and your partner break up, or you begin living with a partner
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You or your partner no longer work the required 16 or 30 hours a week
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You are a couple with children and your combined working hours fall below 30 hours a week
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You, or your partner, stop working for more than 10 days
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Your WTC contains a child care element and you stop paying for childcare for at least four weeks in a row; or your average weekly child care costs goes down by at least £10 a week, for at least four weeks in a row
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There is a change to the circumstances of a child / qualifying young person in your household - please seek further advice.
NB this list is not comprehensive so contact RNIB Helpline or HMRC if you need further advice.
There is a risk of overpayment of tax credit if HMRC are not told of these changes.
This information gives general guidance only and is not an authoritative statement of the law.
Further information
For further information contact:
HMRC on 0845 300 3900
or
RNIB Helpline
105 Judd Street
London
WC1H 9NE
Call 0303 123 9999
Email helpline@rnib.org.uk
Please note that RNIB can only give advice about benefits for people with sight loss and their carers or dependants.
If you use a language other than English please let us know which language. We will try to arrange a telephone interpreting service.