Tax credits Working tax credits: the basics

People at work

Working tax credits come with a number of different elements

Working tax credits are 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. 

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.

NOTE: Tax Credits are due to be replaced by Universal Credit. Transitional arrangements will apply from 2014 onwards. Full details have yet to be announced.

Working tax credits: How much 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 £1,960 during 2015/16, depending on your income.

In addition, you can receive extra elements depending on your circumstances. So for example couples and lone parents get up to an extra £2,010; people who work more than 30 hours a week up to an extra £810; and disabled workers up to £2,970 (or £4,245 if severely disabled).

Again, the elements you are entitled to are added together but your maximum award is reduced the more you earn.

Working tax credit elements

Below are the different working tax credit elements and how much each element is worth in 2015-2016:

Working tax credit
Working Tax Credit elementsMaximum amount paid for 2014/15
Basic element – one per single claimant or couple£1,940
Couples’ and lone parents’ element (paid in addition to the basic element but only one Couples’ element allowed per couple£1,990
30 hour element (paid if you work 30 hours or more per week but only one element allowed per couple)£800
Disabled worker element. (a couple can receive two elements if both claimants are eligible)£2,935
Severe disability element (a couple can receive two elements if both claimants are eligible).£1,255
50+ return to work element (working 16-29 hours per week). Payable for up to 12 months.N/A
50+ return to work element (working 30 hours or more). Payable for up to 12 months.N/A
Childcare element, childcare for one child70% of cost of childcare to a maximum of £175 a week
Childcare element, childcare for two or more children70% of cost of childcare to a maximum of £300 a week

Claiming childcare costs

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 70% of of childcare costs to a maximum of £175 a week for one child or £300 a week for two or more children.

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