News and Views
Am I entitled to the new Tax Credits?

Two new tax credits were launched on 6th April 2003, Working Tax Credit (WTC) and Child Tax Credit (CTC). WTC is paid to those in work and on lower wages. CTC will be paid to those with children under 16 (or under 18 and in full time education).

Broadly to qualify for WTC you will need to fulfill the following criteria:

Be aged between 16 and 24 and working not less than 16 hours per week and have a child for whom he/she or partner is responsible, or
Be aged 25 or over and working not less than 30 hours per week, or
Be aged 50 or over and working not less than 16 hours per week (although limited credits are available in this instance)

and:

Be earning less than:
£13,235 if you are aged below 25
£14,911 if you are aged between 25 and 49
£16,060 if you are aged 50 or over
(The income limits are based on couples and will be less if you are a single claimant)

To qualify for the CTC you will need to fulfill the following criteria:

Have a child, aged 16 and under, or a young person, anyone aged 16,17 or 18 and in full time education, living with you, and
Have family income of less than:
£20,289 couple, one child, no childcare
£24,195 couple, two children, no childcare
£33,570 couple, one child, maximum childcare allowance
£51,681 couple, four children, maximum childcare allowance

The above income limits are for example only as the limit in each circumstance will depend on how many qualifying children you have and whether childcare is paid for.

Childcare allowance is given to parents who both work for at least 16 hours a week and the care is provided by an approved home carer, child minder or at a out of school club.

There are also disabled elements to both the WTC and CTC where the adult and/or child are collecting disability benefits.

Claims for the new tax year commencing 6th April 2003 must be made before 6th July 2003 as a claim can only be backdated by three months. Do remember that once the claim is made any important changes, such as marriage, birth of a child change of employer or increase in annual income of over £2,500 have to be notified to the Inland Revenue.