HUNDREDS of thousands of families have just weeks left to reapply for tax credits or else their payments could be stopped.
Families have until July 31 to check the information in their renewal pack is correct and respond to HMRC or risk losing up to £3,685 a year.
1
They’ll need to notify the taxman of any changes to their circumstances which may affect their claim.
More than 500,000 tax credits customers will need to reply to HMRC by the deadline to confirm their circumstances for the 2023/24 tax year.
If they don’t act by the deadline, the benefit could be stopped, and they could even have to pay the money back.
Affected families should have received a letter in the post sometime between May 2 and June 15.
What are tax credits?
There are two types of tax credits – working tax and child tax credit.
Working tax credit is given to people who are on low incomes or are registered as disabled.
Child tax credit is given to adults over 16 who have children under 16 who are dependent on them.
You do not need to have children to claim working tax credit. However, you must already claim working tax credit to get child tax credit.
Most read in Money
The exact amount of working tax credit you get depends on your circumstances, but you are entitled to a basic amount worth up to £2,280 a year.
There are then additional elements that can increase your entitlement. For example, if you have a disability you could get up to £3,685 a year.
For child tax credit, the amount you get depends on when your children were born.
If your kids were born before April 6, 2017, you could get the “child element” of child tax credit for all of them.
You’ll also get the basic amount, known as the “family element”.
Universal Credit has already replaced tax credits for new claimants, but many households have not made the switch over yet.
Everyone should be transitioned over to Universal Credit by 2024, the government has said.
How do I renew my tax credits?
You should be sent a letter from HMRC which will have either a black line and say ‘check now’, or a red line and say ‘reply now’.
If your letter says ‘check now’, you don’t need to do anything except check your details are correct. If everything is in order, your tax credits will be automatically renewed.
If your letter says ‘reply now’, you must renew your tax credits by July 31 or you risk losing your entitlement.
You can renew your tax credit online on HMRC’s website or by using the HMRC app. Alternatively, you can renew them by phone or post.
You’ll need your renewal pack, details about any changes to your circumstances, and you and your partner’s total income for the last tax year.
Circumstances you need to report include:
- if your living circumstances change, for example, you end a relationship with a partner
- a child or partner dies
- your income goes up or down by £2,500 or more
- a child stops going to childcare for four weeks or more
- childcare costs stop, go down by £10 or more per week, or you start getting help with childcare
- a child leaves home, for example if they move out or go into care
- a child is taken into custody
- a young person over 16 in your care leaves education or training
- your working hours fall below 30 hours a week – this is combined if you are in a couple
You also need to notify HMRC if you will be abroad for eight weeks or more or if you permanently leave the UK.
What if I don’t put in a renewal claim?
If you don’t renew your tax credits, you’ll lose your entitlement to the benefit and you may have to pay back any credits you’ve received since April 6 this year.
HMRC will send you a letter confirming this, which will say TC607.
However, you have then 30 days to contact HMRC and tell them why you missed the deadline.
You could be given until the following January to confirm your details, but HMRC decides this on a case-by-case basis.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected].
You can also join our new Sun Money Facebook group to share stories and tips and engage with the consumer team and other group members.
