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Working Tax Credit changes: what you need to know

03 April 2012

Couples with children who are receiving Working Tax Credit where one partner is receiving Carer’s Allowance are at risk of losing their full tax credits unless they contact the Tax Credit Office by 6th April.

From the 6th of April the Government is increasing the number of hours a couple with children has to work in order to receive Working Tax Credit (lone parents are not affected).

Instead of needing to work for 16 hours or more a week couples with children will have to work 24 hours a week or more. If they are unable to find the extra hours they will lose their entitlement to Working Tax Credit.

However, following campaigning from Carers UK and other groups including the Low Incomes Tax Reform Group and USDAW the union, the Government has announced that couples including someone on Carer’s Allowance will be exempt from this increase from 16 to 24 hours.

This means that a couple with at least one dependent child and where one partner is entitled to Carer’s Allowance, will continue to be able to receive Working Tax Credit if one parent is working for at least 16 hours a week. This includes people with an ‘underlying entitlement’ to Carer’s Allowance - where you are entitled to the benefit but it is not being paid to you because you receive other benefits which are seen to ‘overlap’ with Carer’s Allowance.

The Tax Credits Office should already know that someone in your household is receiving Carer’s Allowance if you informed them of this when you claimed Working Tax Credit. However if you are not sure, and particularly if you have started to receive Carer’s Allowance since you claimed Working Tax Credit, you should contact the Tax Credit Office to confirm you are entitled to Carer’s Allowance.

To contact the Tax Credit Office, you can call 0345 300 3900, email via www.hmrc.gov.uk/contactus/email.htm or write to:

Tax Credit Office
Preston

PR1 4AT

You should provide your full name, date of birth, National Insurance Number and email address (if you have one) and inform them that you fulfil one of these exceptions.

New entitlement to childcare costs

As well as protecting carers from this change, the Government has announced that couples receiving Working Tax Credit which include someone receiving Carer’s Allowance will now be able to claim extra tax credits for childcare if they pay for registered/approved childcare.

Again, if this applies to you, you should inform the Tax Credits Office to ensure you receive the extra amount. You can do this from 6th April, but should do it by 6th May 2012.

For more information on the Government’s other changes to the benefits system, read our Welfare Reform Frequently Asked Questions for further details about tax credits, you can visit the HM Revenue & Customs website

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