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Child and working tax credits explained


As the Beatles famously once said ‘all you need is love’.

And this applies when it comes to mums and their little ones.

However, in some cases that new pair of baby shoes, new top or even nappies require a little bit more and if you’re on a low household income, or a single mum you can sometimes find that making ends meet may be a little bit difficult.
Thankfully, the government, or more accurately HMRC, is here to lend families who need it, a helping hand, with many households on low incomes entitled to tax credits.

These come in the shape of child tax and working tax credits and depend on a number of factors including; age, income, hours worked, number and age of children, childcare costs and any disabilities.
Both are also tax free and you don’t have to be paying National Insurance or any type of tax to qualify for these.

Some households can also claim both so it’s worth doing your financial homework when it comes to this.

Before you start, it helps to get details, or a rough idea, of your total income. This includes the joint income of your other half too as whether you qualify and what you’re entitled to, largely depends on this.

Child tax credits
Child tax credit is for people who take care of any children eligible for child benefit – that’s those under the age of 16 or up to 20 if they're in full time education or registered with the careers service.  You don’t have to be working to be entitled to this.

There are a range of elements when it comes to this type of benefit. The Family element is the basic factor for families responsible for one or more children or qualifying young people, while the child element is paid for each child you are responsible for. If you have a child who is disabled and you receive Disability Living Allowance then you may also qualify for the disability element of the child tax credit.

If you work and have a child in childcare then the childcare element may also apply if you’re a single mum who works at least 16 hours a week or a couple who both work at least 16 hours a week and who spend money on registered or approved childcare. However this depends on how much you earn per year and the hours you work.

To get a full understanding of what you’re entitled to if you work less than 16 hours a week then click here.

For parents working more than 16 hours a week you can see what you’re entitled to here.

In general you may apply for child tax credits if you earn under £30,000 although government rules change so it’s always wise to check at the time of applying. You may also be entitled to tax credits if you are paying childcare - calculate what you could be entitled to by using HMRC’s table for childcare and child tax credits here

Working tax credits
Working tax credits are also there to give mums a helping hand (although they also apply to people without children). The aim of this type of benefit is give an extra boost to those in work on lower pay and covers those working over 16 hours a week, single parents or those in a couple who are disabled, a carer or over 60 or if your other half is ill, in hospital or prison.

As with child tax credit, this is made up of a series of different and separate elements, and the total you get is the sum of all those different parts.
If you have one child you may be eligible for some tax credits if your household income for tax credits is less than £30,000 a year before tax. Again, your childcare costs may affect the amount you receive. 

You can check here to see if you qualify for tax credits and for a breakdown on how much you may receive.

Changes at home and work
If your circumstances change it can affect the amount of money you should be getting. Go to directgov.uk to contact HMRC as soon as possible to tell them about any changes.

Contact HMRC
You can contact the Tax Credit Helpline on 0345 300 3900 or textphone 0345 300 3909, open from 8.00 am to 8.00 pm Monday to Friday and Saturday 8am to 4pm.