GeneralTAX For Individuals

Tax Credits

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Tax Credits are payments from the UK Government. In the UK, there may be certain circumstances which mean that you are entitled to tax credits. There are two fundamental tax credits in the UK with the basics about tax credits being outlined in this article. There are number of factors which will affect the actual amount of tax credit that you are entitled to receive from the government. These include: -          How many children you have living with you in the household -          Do you live with a partner or in a couple? -          Do you work? If so how many hours do you work and are you paid? -          Do you pay for childcare -          Does the child (or yourself) have a disability. Child Tax Credit The first of these tax credits is called the Child Tax Credit (CTC). You may be eligible for this is you are responsible for at least one child in the household (or a young person). This in effect means that if you have children you can get tax credits, but if you do not actually have kids, you may also qualify for the CTC. The main criteria is that you have a child (or a young person) who normally lives with you. You do not have to be working to be able to claim the child tax credit. With the CTC, there are a number of factors that can affect what you can claim for. The table below outlines these.

The CTC Element

What does this mean

Current Maximum (annual)

Family / Basic Element

You are entitled to this if you are responsible for one or more child


Child Element

For each child, this is paid on top of the family element


Disabled Child Element

For each disabled child, this is an extra payment


Severely Disabled Child Element

An additional payment for each child that is severely disabled and under your care


  Note: These figures were correct at the time of writing this article – 22 August 2013 Working Tax Credit The other tax credit that you may be eligible to qualify for and claim from the government is the Working Tax Credit (also known as the WTC). This tax credit, unlike the above, is based on the number of hours that you work and are paid for (or expect to be paid). Only paid work counts towards the WTC whether you are an employee or a self-employed person. The table below details each element of the WTC and what your yearly entitlement could be:

The Element

Who is this applicable to

Annual maximum amount


If you qualify for WTC this is the basic amount you are entitled to



Joint claim to be made and is paid on top of the basic element


Lone parent

Single parent bringing up child is paid on top of basic element


30 hour

If you work at least 30 hours a week – this is an additional payment



Extra entitlement if you work and have a disability (or if you are in a couple, at least one of you is disabled)


Severe disability

Extra entitlement if you work and have a disability (or if you are in a couple, at least one of you is severely disabled)



This is an additional payment if you pay for registered or approved childcare

Up to 70% of your total costs up to a maximum of £175 per week to £300 per week for 1 or 2 children respectively

HMRC do provide a tax credit calculator which can provide you with an estimate to what you could be entitled to. Please click here to use this calculator. The other important thing you must bear in mind is that if you are renewing your claim for tax credits, this must be complete by 31 July. If you would like more information about tax credits and whether you are eligible to claim them, then please contact us at Wisteria on 020 8952 0140 or email [email protected] where one of our tax specialists will be able to assist you.  

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