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Affect other Benefits

Tax Credits Affect Other Benefits

How Does Tax Credit Affect Other Benefits? This section explains how some benefits affect each other. Claiming Tax Credits does not usually affect Child Benefit. But it does affect your Housing Benefit payments.

Once you get tax credits it often reduces the payments for;

Income Support
Housing Benefit
• income-related Employment and Support Allowance
• income-based Jobseeker's Allowance
Pension Credit

Note: The office that sends your benefit payments can help you work out how tax credits affect your benefits.

Do You Get Tax Credits? You may qualify for extra support and benefits if you already get tax credits. Check to see if you can get help with;

As a rule you will need to prove that you receive tax credits to get extra help. Use your Tax Credits award notice as proof. You can also show your TC 603 R form if you qualify for automatic renewal. The Tax Credit Helpline can give more advice if you do not have these documents.

Benefits Affecting Your Tax Credits

In most cases your income determines whether you qualify and how much benefit you can get. It is the same for tax credits. There are several benefits that also count towards your income. This includes certain foreign benefits.

Disability Benefits: Extra Tax Credits are available if you or your child get disability benefits.

Universal Credit: Your tax credits are going to stop if you start getting Universal Credit.

Note: The benefits calculator is the government's online adviser for finding out what benefits you could get.

Tax Credits if You Have a Baby

Having a baby means you may qualify to claim tax credits. Those who already get tax credits may get more money if they have a baby. But, you cannot see exactly what you can get until you apply.

HMRC Tax Credits Claim FormThe Tax Credits table shows how much you may get if you qualify.

Tax Credit How Much You May Get
Child Tax Credit £3,325 per year (maximum)
Tax Credits for Childcare Up to £122.50 a week (1 child): £210 a week (2 or more children)
Working Tax Credit £1,960 per year (maximum)

Even when you stop work to have a baby you still qualify for Working Tax Credit;

The qualification criteria states you must have been working for at least 16 or 30 hours a week before your leave. The actual number working of hours depends on your household circumstances.

Note: The tax credit calculator helps you work out the amount you can get.

Claiming Tax Credits When You Have a Baby

You can apply to claim tax credits if you have not yet applied. You can also update your claim if you already applied for Child or Working Tax Credit. Contact the Tax Credit Office to update a claim. There is no need to fill out a claim form.

Inform the Tax Credit Office within 1 month of the birth. That means they can backdate your claim to the date of birth. If not, your tax credits can only be backdated by one month from the date of your claim.

Tax Credits: Working out Childcare Costs

Most mothers can claim extra tax credits to help with childcare costs. You can make your claim one week before you start paying for childcare. You may need to report changes to the Tax Credit Office if you already claim for childcare costs and they have changed.

Only include costs you pay yourself when you calculate your childcare costs. Giving the wrong amount means you may not receive the correct credits. Your childcare calculation cannot include;

Tax Credits Check Claim

This section explains about Tax Credits checks. There is information on what you need to send and what happens to your claim. You can also find out the deadline for responding to the Tax Credit Office.

You will get a letter from the Tax Credit Office if they want to check your tax credits. You must reply with the information they have asked for by their response deadline. In most cases, tax credits checks are carried out to ensure you get the right amount of benefit.

  1. The letter you receive explains the reason for a check and what you must do.
  2. The letter shows the reply deadline. Make sure you send the information back to them before the deadline expires.
  3. You will get another letter from the Tax Credit Office clarifying the results of their Tax Credit check.

The Tax Credit Office can ask you about your personal circumstances. This includes your employment details and your income. They can also ask your employer or childcare provider for information about your check. As a rule you will get back any original documents you send to them. The exception could be if they believe the documents are not genuine or not do not belong to you.

Results of a Tax Credits Check

What happens after a Tax Credits check? In some cases your tax credits will;

Tax Credits Penalties

You may also receive a penalty if you;

Note: Contact the Tax Credit Office if you have difficulty sending what they ask for. Your payments may stop if not. You will have to repay any tax credits that you should not have claimed for.

How Does Tax Credit Affect Other Benefits; UK Rules Updated 2017