Changes in personal circumstances can affect the amount of tax credits a claimant is entitled to. If you claim tax credits it is important that you report any changes in your circumstances as soon possible to ensure that you receive all the tax credits you are eligible to or that you are not overpaid any of the benefit which would result in you owing money.
Changes should be reported either by calling the Tax Credit Helpline or writing to the Tax Credit Office. Most changes cannot be reported in advance but should be reported as soon as possible after the change has happened. Changes in circumstances cannot be reported via e mail or online by any other means, apart from a change of address if you’re also receiving child benefit.
What changes need to be reported and how?
- Change in Income
It is common for incomes to change from one tax year to the next. If you claim Tax Credits and your income changes (or joint income for couples) the Tax Credit office needs informed as soon as possible. If an income has reduced, any increase in Tax Credits you are entitled to as a result, can only be backdated for up to one month. If your income has increased and you are therefore entitled to less Tax Credits informing tax credits early of the change is important otherwise you may build up a large overpayment which you will need to pay back.
A change in circumstance of this type should either be reported via the Tax Credit helpline or in writing to the Tax Credit office.
- Starting work
If either you or your partner starts work after previously being unemployed, regardless of the hours you will work in your new job, the Tax Credit office needs to know. The information required by Tax Credits in these circumstances are the dates you are due to start, or did start, work, the hours per week you work, your income and your new employer’s full pay office address and PAYE tax reference. PAYE references can be found on payslips. Again this type of change can either be reported over the Tax Credits helpline or in writing. You can report starting work up to seven days before the job begins but no later than one month after starting.
- Stopping work
The Tax Credit office needs to be notified if you or your partner stops working, unless you expect to start a new job, or re-start the same job, within four weeks. You must report that you or your partner have stopped work within one month of doing so to ensure you are paid the correct amount of Tax Credits.
- Changing jobs
A change in job, by either a Tax Credit claimant or their partner, must be reported to the Tax Credit office.
If the old job has already finished, you can report the new job up to seven days before it begins.
If the period of time between two jobs is four weeks or more, Tax Credits must be informed within one month of the new job starting.
If the gap between jobs is less than four weeks you should report the new job as soon as you start, as any increase in Tax Credit payments that may result from the job change can only be backdated by up to one month.
As with starting a new job after previously being unemployed, the Tax Credit Office will request that you provide them with your new employer’s full pay office address and PAYE tax reference.
- Change in hours worked
The Tax Credit office needs to know if the hours you work fall below the minimum hours required to be eligible to claim Working Tax Credit. The minimum hours you need to work to receive Working Tax depend upon your circumstances;
If you don’t have children you need to work 30 hours a week, unless you are disabled or over 60, in which case it is 16 hours. If you are a single parent you must work 16 hours per week to be able to claim Working Tax Credits and if you are a couple with children you must jointly work at least 24 hours per week, with one of the couple working at least 16 hours.
Tax Credits also need to be informed if you or your partner were previously working more than 30 hours a week but this has fallen to less than 30 hours and if you are a couple with children and jointly your working hours have fallen to under 30 hours per week. All these changes may affect the amount of Tax Credits you are entitled to.
Any change in hours worked must be reported within 1 month either over the phone or in writing.
- Change in address and/or phone number
Any change in address or phone number must be reported to the Tax Credit office as soon as possible after the move/ phone number change has taken place.
If you receive Child Benefit as well as tax credits, address and phone number changes can be reported via an online form that can be found on the HMRC website.
If you do not receive Child Benefit, address and phone number changes must be reported directly to the Tax Credit office, either via the helpline or in writing.
- Change in bank details
Either over the telephone to the helpline, or in writing to the Tax Credit office, Tax Credits must be informed as quickly as possible if you start using a new bank or building society account. The new account details can be given up to 30 days before it starts being used to ensure no payments are missed.
You will not be able to change bank account details over the phone if you have already changed bank details twice already in the past year. If this is the case for you, you will need to request in writing to change account details again.
- Maternity and adoption leave
The Tax Credit Office do not need to know about any maternity or adoption leave you or your partner take unless you don’t go back to work after the first 39 weeks. If you are not returning to work straight after the first 39 weeks of maternity/adoption leave, Tax Credits must be informed either in writing or by telephone within one month after the 39 weeks leave ends.
- Paternity leave
If you are taking the normal two weeks of ordinary paternity leave the Tax Credit office do not need to be informed. If however you extend this leave for any reason you must notify Tax Credits.
- Sick leave
The Tax Credit office must be informed if either you or your partner doesn’t go back to work after the first 28 weeks of being off sick. They must be informed within one month after this 28 weeks ends.
- Suspension from work
If you or your partner are suspended from work the Tax Credit Office are required to know only if you don’t return after the suspension
- Strikes
A strike that lasts more than ten working days in a row may affect your Tax Credits claim and so the Tax Credit office must be informed if you or your partner has been on strike for more than ten days. Again you have one month to inform Tax Credits about this change in circumstances.
- You leave the UK
If you leave the UK for good, leave and expect to be gone for at least 52 weeks, go abroad for a short stay of 8 weeks or more (12 weeks if the trip is because you or a family member are being treated for an illness or because a family member has died) or lose the right to reside in the UK, Tax Credits need informed.
- You or a member of your family receives a custodial sentence
If anyone in a Tax Credit claimant’s family is taken into custody, the Tax Credit office must be notified, within one month of the sentence beginning.
- Changes in relationship status
If you get married, enter into a civil partnership, move in with someone, or separate from a partner, the Tax Credit office needs informed as soon as possible after the changes take place, and definitely within one month.
Tax Credits also need to be informed if your partner dies, within one month of it happening.
- Changes involving children
Changes involving children from newborn to 20 years of age, if they are living as part of the claimant’s family, must be passed on to the Tax Credit office within one month of the change taking place.
Changes that the Tax Credit team need notified about are; if a child leaves home, if a child is taken into care or placed with a family for fostering or adoption, if a child has received a custodial sentence of more than four months, if a new child joins your family- either a new baby is born or a child or baby is fostered or adopted.
If you have previously been paid Disability Living Allowance or Personal Independence Payments for a child in your household, and these payments stop Tax Credits need notified as soon as possible. The same applies if a child in your household starts receiving any of these benefits. Tax Credits must also be notified as soon as possible if a child is newly registered as blind or if they have previously been registered as blind and now aren’t. Tell the Tax Credits office as soon as you can if a child dies.
If a child in your household reaches 16 and is staying on in education or training that counts for Child Tax Credit after age 16, Tax Credits need informed. They can be informed of this change up to three months before the course begins. For a child over the age of 16 the Tax Credit office also needs informed of any other changes that may affect your Tax Credits claim, for example if they leave education or start receiving benefits of their own.
- Childcare changes
Changes in the childcare you receive may result in changes to the Tax Credits you are entitled to. Changes regarding childcare that the Tax Credits team need to know about are; you start or stop paying for childcare, you start receiving help with childcare from another source, childcare costs that the Tax Credit Office know about already either increase or decrease by £10 or more per week.
- Changes in your disability status
If you or your partner receives extra Tax Credit payments because of a disability, the Tax Credit Office must be informed if you no longer qualify for these extra payments. This would be the case, for example, if your qualifying sickness or disability-related benefit stops. Likewise if either you or your partner starts receiving a disability related benefit you should inform Tax Credits as soon as possible as you may be entitled to extra payments
Why is it so important to report changes quickly?
If you do not tell the Tax Credit office of any relevant changes in your circumstances, it is common that you will be overpaid. This may result in a large amount of money being paid to you which you may be required to pay back. It is also possible that you may be charged a penalty of up to £300 if you are overpaid because you have not reported a change in your circumstances.
On the other hand, if a change in circumstance means that you are entitled to increased Tax Credit payments, and you fail to tell the Tax Credits Office on time, you may miss out on money as increases can usually only be backdated by up to one month.
