In the UK, there are several benefits and allowances available for people living in the UK who meet certain additional conditions. One of these is Tax Credits. If you are raising at least one child or have a relatively low income, it’s worth checking whether you are eligible. So, what exactly are Tax Credits, and how can you claim them?
What are Tax Credits?
In a nutshell, Tax Credits are UK government benefits designed to provide financial support to individuals and families on low incomes. There are two types of tax credit:
- Working Tax Credit
- Child Tax Credit
When are you eligible to apply for a tax credit?
Child Tax Credit is available if you have at least one child.
Working Tax Credit is for people on low incomes.
The detailed conditions for each credit will be discussed in the following sections. For now, it’s important to note that:
- You can apply for Tax Credits as soon as you start working in the UK,
- You can receive both credits at the same time,
- You apply for both on the same form,
- You must apply with your partner if you share a household (it doesn’t matter if you’re married or not),
- You must pay national insurance contributions and have a national insurance number.
Who is eligible for Working Tax Credit?
To get Working Tax Credit, you have to meet a number of conditions. Firstly, you must be working. The work must last for at least four weeks and be paid. The term 'work’ here includes
- Employment,
- Self-employment,
- Combination of employment and self-employment.
In addition, certain minimum weekly working hours are required:
- A minimum of 30 hours – for people aged 25-59,
- At least 16 hours – for people aged 60 or over or single people with at least one child*,
- At least 24 hours – for couples with at least one child, with one of you (you or your partner) working at least 16 hours.
*A child in this case is a person under the age of 16 or a young person (under 20) in full-time education.
Importantly, you can still claim Working Tax Credit if you are under 25, provided that
- You are at least 16 years old,
- You work at least 16 hours a week,
- You have responsibility for a child/have a disability.
Who can get Child Tax Credit?
You can get child tax credit if
- You have at least one child under 16 or an older child in full-time education,
- Your family income does not exceed £58,175 (£66,350 if the child is under one).
Child Tax Credit is separate from Child Benefit. These two benefits are independent of each other.
You can also check your eligibility for Child Tax Credit by using a special online questionnaire.
