HUNDREDS of thousands on benefits should take note of a key date coming later this month or risking losing out on money.
Households have just weeks left to reapply for tax credits or their payments could be stopped.
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Households have until July 31 to check the information in their renewal pack is correct and respond to HMRC.
If they don’t, they risk losing up to £3,685 a year.
Anyone on tax credits needs to inform the taxman of any changes to their circumstances which might affect their claim.
Over 500,000 people on tax credits will need to reply to HMRC by the deadline to confirm them for the 2023/24 tax year.
If they don’t act by the deadline, the benefit could be stopped and they might even have to pay some of it back.
Eligible households should have received a letter in the post between May 2 and June 15.
What are tax credits?
Millions of people across the UK receive benefits, including tax credits, to help them cover the cost of living.
There are two types of tax credits – working tax and child tax credits.
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Working tax credits are given to people on low incomes or registered as disabled.
Meanwhile, child tax credits are given to adults who have children under 16 who are dependent on them.
The amount you can get on working tax credits depends on your circumstances – you are entitled to a basic amount worth up to £2,280 though.
Beyond this, there are additional elements that can increase your entitlement, like if you have a disability.
The amount you get on child tax credits depends on when your children were born.
If they were born before April 6, 2017, you could get the “child element” for all of them.
You will also get the basic amount, known as the “family element”.
Anyone who would normally claim tax credits is now given Universal Credit instead.
Many households are still on the old-style benefit, but they will eventually be migrated across to Universal Credit by the end of 2024.
How to renew your tax credits
You should have already received a letter from HMRC if you are on tax credits and need to confirm your details.
The letter will either have a black line and say “check now”, or a red line saying “reply now”.
If your letter says “check now”, you don’t need to do anything apart from check your personal details are correct.
But if your letter says “reply now” it means you need to renew your tax credits by July 31 or risk losing your entitlement.
You can renew your tax credits online on HMRC’s website or app. Or, you can renew them by phone or post.
You’ll need a few things to hand though, including your renewal pack, details of any changes to your circumstances and you and your partner’s total income for the last tax year.
Here is a list of any changes in circumstances you should report:
- if your living circumstances change
- if your child or partner dies
- your child stops going to childcare for four weeks or more
- your childcare costs stop, drop by £10 or more a week or you start getting help with them
- your child leaves home, for example by going into care
- your child is taken into custody
- any child over 16 leaves approved education or training
- your childcare provider is no longer registered or approved
- your working hours fall below 30 hours a week
- your working hours fall below or go above the minimum required to qualify
- if you will be abroad for eight weeks or more or you permanently leave the UK
What happens if I don’t renew?
If you don’t renew your tax credits, you’ll lose your entitlement and may have to pay back any you’ve received since April 6 this year.
You’ll be sent a TC607 informing you if you’ve not renewed.
But, if you contact HMRC within 30 days of the date of the TC607, your tax credit claim should be reinstated and you won’t have to pay anything back.
If you get in touch with HMRC after 30 days, you will be asked to explain why there was a delay – known as “good cause” – before they consider restoring your claim.
If your claim is restored, the taxman will tell you how much you’ll get within eight weeks of receiving your renewal.
If HMRC does stop your tax credit payments, you won’t be able to make a new claim.
You will have to then apply for either Universal Credit or Pension Credit, depending on your circumstances.
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