Tax credits Working tax credits: the basics
If you're disabled, WTCs could top up your earnings
Working tax credit is a payment to top up the earnings of lower paid workers and workers with a disability.
Generally speaking, you must work at least 30 hours a week, be 25 or older and be earning less than £13,253 if you're single and childless or £18,023 jointly if you are part of a couple, childless but working at least 30 hours a week (amount for 2010-2011).
However, if you are disabled and work or have children you may be eligible for working tax credit if you earn more than this, provided you're aged 16 or over and work at last 16 hours a week.
You may also be eligible for working tax credit if you or your partner is aged 50 or over, work at least 16 hours a week and are returning to work after a period claiming out-of-work benefits.
How much working tax credits will you get?
Just like child tax credits, working tax credit is made up of a number of different 'elements' or payments. You may be eligible for just one element or for a few different elements, depending on your family circumstances.
Everyone who qualifies for working tax credit receives the basic element, worth up to £1,920 during 2010-2011, depending on your income
Working tax credit includes an extra allowance for childcare
In addition, you can receive extra elements depending on your circumstances. So for example couples and lone parents get up to an extra £1,890; people who work more than 30 hours a week up to an extra £790; and disabled workers up to £2,570 (or £3,665 if severely disabled).
Again, the elements you are entitled to are added together but your maximum award is reduced the more you earn.
Claiming costs for childcare
Working tax credit also contains a childcare element – an extra allowance for working families who spend money on approved childcare.
This includes a registered childminder, nursery or playscheme, an out-of-hours club on school premises run by a school or local authority, or a childcare scheme run by an approved provider.
You can claim up to 80% of of childcare costs to a maximum of £175 a week for one child or £300 a week for two or more children.
Elements of working tax credit
Below are the different working tax credit elements and how much each element is worth in 2010-2011:
| Working tax credit | |
|---|---|
| Working Tax Credit elements | Maximum amount paid for 2010 - 2011 |
| Basic element – one per single claimant or couple | £1,920 |
| Couples’ and lone parents’ element (paid in addition to the basic element but only one Couples’ element allowed per couple | £1,890 |
| 30 hour element (paid if you work 30 hours or more per week but only one element allowed per couple) | £790 |
| Disabled worker element. (a couple can receive two elements if both claimants are eligible) | £2,570 |
| Severe disability element (a couple can receive two elements if both claimants are eligible). | £1,095 |
| 50+ return to work element (working 16-29 hours per week). Payable for up to 12 months. | £1,320 |
| 50+ return to work element (working 30 hours or more). Payable for up to 12 months. | £1,965 |
| Childcare element, childcare for one child | 80% of cost of childcare to a maximum of £175 a week |
| Childcare element, childcare for two or more children | 80% of cost of childcare to a maximum of £300 a week |
Table notes
If you qualify for the 50+ 16-29 hours element you cannot also claim the Couples’ element unless you have responsibility for a child or you qualify for the Disability element of Working Tax Credit.
Working tax credits – for people without children
The table below shows how much you might receive in working tax credit for the tax year 2010-2011 for people without children.
| Working Tax Credit – for people without children (2010-11) | ||
|---|---|---|
| Annual income | Single person aged 25 or over working 30 hours or more a week | Couple (working adults aged 25 or over) working 30 hours or more a week |
| 9,0501 | £1,685 | £3,580 |
| 10,000 | £1,315 | £3,210 |
| 11,000 | £925 | £2,820 |
| 12,000 | £535 | £2,430 |
| 13,000 | £145 | £2,040 |
| 14,000 | n/a | £1,650 |
| 15,000 | n/a | £1,260 |
| 16,000 | n/a | £870 |
| 17,000 | n/a | £480 |
| 18,000 | n/a | £90 |
Table notes
- Someone aged 25 or over, working 30 hours a week on National Minimum Wage would earn £9,050 a year.
Working tax credits and child tax credits – for people with children
The table below shows how much child tax credit and working tax credit you might be able to get if you are in work and responsible for at least one child or young person.
| Working Tax Credit and Child Tax Credit – for people with children (2010-11) | |||
|---|---|---|---|
| Household Income | One Child | Two Children | Three Children |
| £5000 | £6,600 | £8,965 | £11,270 |
| £9,050 | £6,430 | £8,730 | £11,035 |
| £10,000 | £6,660 | £8,360 | £10,665 |
| £15,000 | £4,110 | £6,410 | £8,715 |
| £20,000 | £2,160 | £4,460 | £6,765 |
| £25,000 | £545 | £2,510 | £4,815 |
| £30,000 | £545 | £560 | £2,865 |
| £35,000 | £545 | £545 | £915 |
| £40,000 | £545 | £545 | £545 |
| £45,000 | £545 | £545 | £545 |
| £50,000 | £545 | £545 | £545 |
| £55,000 | £210 | £210 | £210 |
| £60,000 | n/a | n/a | n/a |
- For any tax query, call our experts on the Which? Money Helpline
- Try the Which? Tax Calculator
- Take a look at our guide to tax and your children
