Business News

Tax Credits Renewal

Tax credits are state benefits which are generally available to lower income families. However, entitlement to the credits is significantly increased where individuals pay for childcare or have a dip in normal levels of income perhaps due to incurring trading losses.

Individuals who have already claimed tax credits for 2007/08 have to finalise their provisional award, which would have originally been based on their 2006/07 income, and advise HMRC of any changes in their circumstances for 2008/09. This procedure is known as the renewals process. The deadline for the submission of tax credit renewals is 31 July 2008.

HMRC have been busily advertising the renewals process in the national press and on their website. Claimants need to be aware that the payment of tax credits will stop at the end of July if they have not renewed their applications by that date.

HMRC are also reminding claimants that the deadline for letting them know that their circumstances have changed is just one month. Some examples of the sort of changes which have to be notified ‘in year’ are changes in family circumstances, perhaps a partner moving in or out of the family home, or a reduction in childcare costs. A reduction of £10 a week for a mere four weeks has to be reported!

If you need any help with the completion of your form or any advice on tax credits generally please do get in touch.

Internet links:

HMRC guidance