Do You Qualify For A Tax Credit?
Tax credits are not tax but payments made by the government to you, to help with basic daily costs. There are two main types of tax credit available in the UK and they are:
- Child Tax Credit - Almost all families are eligible for this type of credit, depending if you have at least one child or young person living with you or your family. The amount you receive is largely dependent on how many children or young people live with you, if any child or children are disabled, and the amount of your monthly income
- Working Tax Credit - If you are employed but earn a low wage you may be eligible for a Working Tax Credit to help with expenses. You can be regularly employed or self-employed to qualify. This type of tax credit is also available to those are working parents, pay for childcare, disabled or over 50
Before applying for tax credit you may want to be sure you qualify for either Child Tax Credit, Working Tax Credit, or both.
To receive Child Tax Credit a family must have a child (or children) or be responsible for a young person 16 years of age and under. Also, the total family income must be no more than £58,175 per annum or up to £66, 350 for families with a child under one years old.
Eligibility requirements for Child Tax Credit are:
- You live in the UK (you may qualify if you live outside the UK)
- Parents at least 16 years old or guardians at least 25 years old
- Having at least one child or being responsible for a young person aged 16 or younger
- The child or young person under 19 years old but in full time education such as A Levels, NVQ level 3 or Scottish Highers (Direct.gov)
- If a young person under your care is between ages 16 and 17 but not going to school full time then you can claim if they do not have a job or training place
- However, you cannot claim if the child or young person is already claiming benefits like: Income Support, their own tax credits, they are serving a custodial sentence, or they are in your care by way of adoption or fostering and you already receive financial help from the local authority
Working Tax Credit applies to those who earn a low wage income. The amount you receive will depend on how many children you may have, your financial circumstances and how much you earn.
- If you have children - You can claim if you are at least 16 years of age and work a minimum of 16 hours per week
- If you don't have children - You can claim if your are at least 25 years old and work a minimum of 30 hours per week. You will also qualify if you are at least 16 years old working 16 hours per week or more and you qualify for disability benefit
You can take the Tax Credit questionnaire to determine your eligibility for tax credit at the HM Revenue & Customs site.
Click here to take the questionnaire.
Published on October 24, 2007
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