How To Claim Tax Credits

What are tax credits and how do I claim them?

Tax credits are still fairly new. There are two tax credits: child tax credit and working tax credit. They are both paid. There is actually only one claim form, and they are both paid by her majesty's revenues and customs. Child tax credit is paid whether you are in work or not, but it is means tested, so it does depend on what other income, and in certain circumstances, savings that the household has coming in. It also depends on how many children you are claiming for, and whether you've got a new baby or not. Most families are entitled to some amount of child tax credit, so it's worth checking out if you are entitled or not. With working tax credit, as it states, you must be doing some kind of work. For working families, under certain circumstances, disabled workers and some workers who are returning to work after a period of unemployment, and they're 50 or over, they have to be in work for 16 hours or more to claim working tax credit. The other group of people who are entitled to working tax credit are people on low income who are over 25, and they must be in work for 30 hours of more. Therefore, if you are under 25 and on a low income, I'm afraid you'll probably have no entitlement. One of the key things to remember about tax credits, and it's had a lot of media coverage, is the level of overpayments that can arise. This has perhaps put some people off claiming. To reduce the risk of being overpaid tax credits, what you have to remember to do is notify the tax credits, her majesty's revenues and customs, if you have any relevant changes of circumstance. Thus, if your hours of work change, your salary changes, if one of your children leaves school, or if your childcare costs change, anything that you think might have impact on the amount of benefit that you're being paid, tell them. That should definitely keep the risk down.