Changes to tax credits

Published September 23, 2015 at 15:28

Working tax credits and child tax credits are designed to help low-paid workers and low-income families. Millions of working families claim both benefits – and they can be worth thousands of pounds a year.

Working tax credits

The last Labour Government introduced working tax credits in 2003, but similar benefits have been in place since 1986.

The benefit helps low-paid workers, who can typically get up to £1,960 a year. But couples applying together and single parents get more, while full-time workers get less.

Child tax credits

Low-income Brits can get child tax credits on top of child benefit to help with the cost of raising a family. You don’t have to be working to get child tax credits. The basic child tax credit is £545 a year, but you can get up to £2,780 a child.

What’s changed?

The government has announced that now families will only be able to claim for their first two children. The £2,780 top rate stays the same, but a big family will only be able to claim as if they had two children instead of three, four or five.

However, the rule only applies to children born after 6 April 2017.

 

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