What happens to my tax credits if my circumstances change?
It's important to keep HMRC up to date with any changes to your income or your family circumstances, as this could have an impact on how much you get.
Tax credits changes: one month deadline
By law, you must tell HMRC within one month of the following changes happening:
A change in partners
If you claimed as an individual but you are now married, in a civil partnership or living with someone as a couple, or if you claimed as a couple but you have separated or your partner has died.
Your job changes
You must inform HMRC within one month if you stop working, you are working at least 16 hours a week and your hours drop below this, or you are working 30 hours or more a week and your hours drop below 30 hours or reduce to nil.
For couples with children, it is your joint working hours that count towards the 30-hour total.
You must also let HMRC know if you've been on strike for more than 10 days. The same goes for losing your right to work or reside in the UK.
If you are claiming child-care costs and your costs stop or go down by £10 a week or more (and the change lasts at least four consecutive weeks), you must also inform HMRC.
The same needs to happen if a child or young person you are responsible for moves out to live with someone else or starts to claim Income Support, Incapacity Benefit, income-based Jobseeker’s Allowance, Employment and Support Allowance, child tax credit or working tax credit in their own right.
You also need to inform HMRC is a young person between 16 and 20 you are responsible for leaves full time education or approved training, starts advanced education (for example, a degree course), starts training provided under a contract of employment, or starts paid work (usually for more than 24 hours a week).
Tax credits: other changes
You don't have to tell HMRC about the following changes, but it might be in your interests to do so, as you may be entitled to a higher tax credit award:
- A young person over 16 continues in full time education, registers with a careers service, Connexions or equivalent, or joins an approved government training scheme
- Your income goes down
- Your income goes up. This may not affect your current award, but it will affect how much you get next year. If you get paid too much because you delay telling HMRC about any changes, you will be asked to pay back any tax credits overpaid. See Tax credits overpayments
- Your childcare costs go up by £10 a week or more (and the change lasts at least four consecutive weeks)
- Your usual working hours change from less than 16 hours a week to more than 16 hours a week
- Your usual working hours change from less than 30 hours a week to 30 or more. For couples with children, it is your joint working hours that count towards the 30 hours.
It's worth telling HMRC within three months of a change of circumstances which increases your award, as usually awards can only be backdated by up to three months.