MILLIONS of people are being warned to renew tax credits by July 31 risk missing out on thousands of pounds a year.
Reminders have been sent out to people claiming the benefit telling them that they must refresh their claim for the year ahead.
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That means you have just over a month left to renew your tax credits or be left out of pocket.
There are two types of tax credits – working tax and child tax credit.
Universal Credit has replaced both these for new claimants, but many have not yet made the switch over to the newer benefit.
Around 2.5million claimants getting tax credits were sent renewal packs last year.
The amount you get depends on your circumstances but it can be worth as much as £3,545 for child tax credits or £3,345 for working tax credits.
Each year a claim for tax credits must be renewed, otherwise the benefit could be stopped, and you could even have to pay money back.
If you’re getting tax credits you’ll be sent a renewal pack that you’ll need to complete.
Plus, keep an eye on the post as the pack will have all the information you need about renewing your tax credits.
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Do I need to renew my tax credits?
HMRC sends out renewal packs explaining whether or not you need to renew or update your information.
Those that need to renew will have a letter with a red line on it and the words “reply now”.
People that need to check their details will receive a letter from HMRC with a black line and the words “reply now” on it.
If all your details are correct, you don’t need to do anything – your tax credits will automatically be renewed.
If there’s a change in your circumstances, then you’ll need to tell HMRC about it.
The following changes could have an impact on your tax credit payments:
- Living arrangements
- Childcare
- Working hours
- Whether your income has gone up or down
If you haven’t received a renewal pack closer to the deadline you can contact HMRC.
How do I renew my tax credits?
Your renewal pack will have more information on how to renew, and the information you need to provide.
This will include information on how your circumstances have changed, and the income of you and your partner for the previous tax year, which ran from April 6 2021 to April 5 2022.
You can renew your tax credits three ways: online, by post or over the phone.
To do it online you need to log in to your tax credits account and follow the instruction.
You can renew over the phone by calling HMRC on 0345 300 3900.
By post, you need to sill in the forms in your renewal pack, and send it to: Tax Credit Office, HM Revenue and Customs, BX9 1LR.
What happens if I don’t renew my tax credits?
You have until July 31 to update your tax credits or risk losing your benefits.
If you miss the deadline your tax credits payments will stop.
HMRC will then send you a letter, which will say TC607 on it, and you’ll have to pay back the tax credits you’ve received since April 6 this year.
You have to contact them within 30 days and tell them why you missed the deadline and you need to have a “good cause” for doing so.
You could be given until January 31 next year to confirm your details but this isn’t guaranteed and is decided on by a case by case basis.
If you don’t respond after 30 days, you’ll have to pay your tax credits back up to April 6 this year and your payments will stop.
What are tax credits and how much is it worth?
Tax credits are for those on low incomes and who may have a child or disability,
The exact amount you can get depends on your circumstances.
Working tax credits per year:
- Basic element £2,070
- Couple and lone parent element £2,125
- 30 hour element £860
- Disabled worker element £3,345
- Severe disability element £1,445
- Childcare element £175 or £300, depending on the number of children
Child tax credits per year
- Family element £545
- Child element £2,935
- Disability element: disabled child rate £3,545
- Disability element: severally disabled child rate £1,430
For both Working Tax Credit and Child Tax Credits you can use a benefits calculator to find out how much you could get.
Everyone getting tax credits and other legacy benefits will be moved over to Universal Credit by the end of 2024.
You could be moved earlier if you have a change of circumstances, but it’s worth checking any changes to your entitlement.
You might not be better off moving across and you won’t be able to move back.
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This post first appeared on thesun.co.uk
