Tax credit claimants urged to apply early

Tax Credit customers are being reminded by HMRC that they must renew claims by 31 July – or their payments might stop, reports accountancy services Harris & Co. HMRC will start sending tax credit renewal packs to about 5.8m people from this week until the end of June.

They are urged to act as soon as they receive a renewal pack. More than 3.7m claimants renewed by the deadline last year, 90% of those who were required to renew their claim.

HMRC is also asking claimants to check the accuracy of the information in the pack, and may have to query some of it with employers.

Claimants must tell HMRC about any changes to their circumstances that they haven’t already reported, such as changes to working hours, childcare costs or pay. If asked, they must also provide details of the previous year’s income.

The amount a claimant’s income can change before HMRC must be told – the income disregard – was reduced this April to £5,000.

Having the right documents available will help reduce mistakes when they are filling out the form or calling HMRC’s Tax Credits helpline. These documents would be, for example, payslips, end of year P60 forms and childcare payment details.

Nick Lodge, HMRC’s director of benefits and credits, said:

‘Our message to people is renew early, renew accurately and renew on time. They should aim to renew their tax credits as soon as they receive a pack, and must check that their details are correct. If claimants don’t renew claims before 31 July, their payments might stop.’

Universal Credit, which will take over all tax credit claims by 2017, will be introduced this year. It is therefore important that claimants ensure that the data held by HMRC about their claim is accurate.

More details are available from Gov.uk.