HMRC has confirmed when people on tax credits will receive their first cost of living payment.
It’s part of the £1,350 support scheme from the government going out to millions of people from the Spring.
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And struggling households claiming working tax credits and child tax credits will get the payment between May 2 and May 9.
It’s good news for those on just tax credits as the extra time they’ll spend waiting is a lot shorter this year.
Last year, those on other benefits for their first cost of living payment in July, while tax credit claimants didn’t get theirs until September.
The payment will show as ‘HMRC COLS’ in customers’ bank and building society accounts.
The payment is automatic – you shouldn’t need to do anything.
Only those on tax credits and no other means-tested benefits will get the cost of living payment on these days.
Those on means-test benefits will get their first payment between April 25 and May 17.
Chief Secretary to the Treasury, John Glen, said: “Higher prices make life difficult for everyone, which is why our priority is to halve inflation this year.
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“But we are also going further to support those struggling most, with a total package of support worth an average of £3,300 per household this year and next – including up to £900 in direct cash payments starting next month for families receiving tax credits.”
Tax credit claimants will get their cost of living payments later than those claiming other benefits.
That’s to ensure those on other benefits and tax credit will not get the payment twice.
If you receive tax credits along with a qualifying benefit from DWP you will be paid by the DWP.
This is the first of three payments totalling up to £900 for those eligible in 2023-24.
Those eligible must have received a tax credit payment between January 26, 2023 and February 25, 2023, or later be found to have been entitled to a payment for this period.
The second cost of living payment will be made in Autumn this year and the third in Spring 2024.
What is the £900 cost of living payment?
The £900 cost of living payment is a support payment paid to households in the UK that are struggling the most.
This payment will be tax-free and will not have any effect on any existing benefit payments that you receive.
More than eight million people will receive the payment.
Who is eligible for the £900 payment?
The £900 payment will be going to millions on means-tested benefits – you’ll only be able to get it if you are claiming one of these benefits below.
- Income-based Jobseeker’s Allowance
- Income-related Employment and Support Allowance
- Income Support
- Pension Credit
- Tax Credits (Child Tax Credit and Working Tax Credit)
- Universal Credit
For the previous payments, you had to be entitled, or later found to be entitled to one of these benefits by a certain date.
What else is part of the cost of living support?
Millions will be in line for part of £1,350 though some could qualify for it all.
It’s rare that households will qualify for all three payments but if you do, you’ll get the full £1,350 on offer and you’ll be automatically paid.
For example, if you claim pension credit and attendance allowance and are eligible for the winter fuel payment you’ll get the full amount.
As part of the £900, a second payment of £300 and a third payment of £299 will be made.
Payment windows for the £1,350 payment will be broadly as follows, though bear in mind you may get them slightly later if you’re on only tax credit:
- £301 – First Cost of Living Payment – during Spring 2023
- £150 – 2023 Disability Payment – during Summer 2023
- £300 – Second Cost of Living Payment – during Autumn 2023
- £300 – 2023 Pensioner Payment – during Winter
- £299 – Third Cost of Living Payment – during Spring 2024
Check if you are entitled to benefits
A number of charities have benefits calculators that you can use to work out if you are entitled to any extra help.
This includes:
- Turn2Us
- Policy in Practice
- EntitledTo
It’s worth looking into, as if you do qualify, it could make you eligible for the £900 cost of living payment too.
Before you do use such a tool, you should make sure you have all the relevant paperwork to hand, including bank statements and any information on pensions and existing benefits.
You’ll also have to give information about yourself, including your age and who you live with.
Remember though, the tools only give you an indication of what benefits you might be entitled to.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected]
