Changes from 6 April 2013

From October 2013 Child Tax Credit and Working Tax Credit will be replaced by Universal Credit — a new single monthly payment for people in work or out of work (see chapter 1 for further details). No new claims for tax credits will be accepted from 6 April 2014.

If you are already getting tax credits in October 2013, you will continue to get them and will be able to renew your claim until you are transferred onto Universal Credit. The process of transferring everyone from tax credits to Universal Credit is expected to be completed by October 2017.

Tax credit awards are given for tax years. The tax year runs from 6 April in one calendar year to 5 April in the next. The amount you receive during the year is an estimate of your likely entitlement. Awards are only finalised after the end of the tax year.

The Tax Credit Office will tell you when you can make a claim for Universal Credit, and stop claiming tax credits. You won’t claim both at the same time. It will take up to four years before all tax credits claims are stopped, so don’t worry if you don’t hear anything soon.

It will be made up of a standard allowance plus other “elements” — for example, for children, childcare, housing and caring. There will also be an element for those with limited capability for work. So the amount you could get will depend on your own circumstances.

From April 2013, any rise in income of £5,000 or more during the award year will be taken into account when finalising Tax Credit awards. Previously only income rises of £10,000 or more were taken into account.

If you qualify, your monthly payment will cover everyone in your family who qualifies for support. “Family” could mean you as a single person for example, or you might also be claiming for a partner and/or children.

Universal Credit will eventually replace all of the following:

• Tax Credits — both Child Tax Credit and Working Tax Credit;

• income-based Jobseeker’s Allowance;

• income-related Employment and Support Allowance;

• Income Support;

• Housing Benefit.

Universal Credit does not replace Child Benefit.

You can find more information about the Universal Credit on the Department for Work and Pensions (DWP) website at: www.dwp.gov.uk/policy/welfare-reform/universal-credit/