Child tax credits
It’s very common for people to assume that they will not be eligible for benefits over and above the Child Benefit payment that everyone is entitled to. However, our experience tells us differently. In fact the vast majority of UK families are eligible for additional financial assistance. The most commonly misunderstood one is Child Tax Credits from the Government. This is tax-free income for households with children. These are made up of a number of elements and are worth different amounts as they are means-tested based on your circumstances.
How much could I receive?
You can claim Child Tax Credits whether you’re in work or not. You are eligible as long as your family income is no more than:
- Around £58,000 a year if your children are over one year old; or
- Around £66,000 a year if you have a baby under one year old.
There is a family element that most families get and a child element payable for each child, and you might receive extra if your child has a disability.
What are the different elements of Child Tax Credit and how much are they?
| Element |
Description |
Maximum award for 2010 |
|
Family |
The basic element for families responsible for one or more children. |
£545 per year |
|
Family – child
under one year old |
For families responsible for one or more children under the age of one.
Note: only one payment may be available regardless of how many children under the age of one |
£545 per year |
|
Child |
For each child or young person you are responsible for. |
£2,300 per year |
|
Disability |
This is one payment for each child you are responsible for if you are receiving Disability Living Allowance for the child, or the child is registered blind or has been taken off the blind register in the 28 weeks before the date of claim. |
£2,715 per year (an additional £1,095 is awarded if your child is severley disabled) |
All of the above are maximum payments and your eligibility for them is means tested. Therefore the more you earn the less you will receive and vice versa. The best thing to do is check out our
Benefits Calculator and find out.
Source : HMRC www.hmrc.gov.uk/taxcredits/payments-worked-out.htm
How much could I get?
The main variables to determine this are:
- If you are single or in a couple
- How many hours you (and your partner) work in a week
- How many children you have
- If any of them are less then 12 months old
- The cost of your childcare
- Your income
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Example 1
The Jones’ both have full-time jobs. Between them, they earn approximately £30,000 a year. They have three kids, all of whom are older than one year old. They have no childcare costs so in total they get about £49 a week in Child Tax Credits.
If their income went up to say £48,000 a year, their tax credit entitlement would reduce and they’d only receive about £10 a week instead.
Example 2
Tricia is 28, unmarried and not living with a partner. She has one child under the age of one and earns £10,000 a year working as a teaching assistant. She should receive about £64 a week in Child Tax Credits (and may also receive working tax credits). |
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Ultimately this is something that’s based on your individual situation so you should use our Benefits Calculator to help find this out.