21 July 2011

Tax credits renewal deadline fast approaches

July is a busy month for the tax credits helpline as the renewal deadline fast approaches. A claim for tax credits lasts for a maximum of one tax year which means a new claim needs to be made each year. Fortunately, there is no need to complete the TC600 claim form every year.

After the tax year ends in April, HMRC start to send renewals packs to claimants. Normally all packs are sent out between April and June. The renewals process is crucial as it does two things. First, it finalises the claim for the year just ended, normally by asking the claimant to confirm their 2010-2011 actual income. Secondly, for many claimants it will also act as a claim for the new 2011-2012 tax year.

Like many things to do with tax credits, it can be a complicated process. Not everyone receives the same renewals pack and not everyone is required to take the same action.

The most important thing to note is that the renewals deadline this year is 31stJuly 2011.

Last year, the tax credits helpline was extremely busy and many claimants had a difficult time getting through. Renewals can be completed over the phone or by returning the forms sent out by HMRC. Complications can arise if the deadline is missed, therefore we recommend that claimants who are finding it difficult to renew over the phone should send back the paper forms to meet the 31stJuly deadline.

We suggest that where possible claimants make a copy of the form before sending it back and also use a recorded delivery postal service so that they have proof of returning it before the deadline. 

We have written a detailed guide about the renewals process which explains what packs claimants should receive, what they need to do and other points about the process that advisers should be aware such as what to do if your client has missed the deadline or wants to withdraw from the system.

HMRC have also produced a help sheet for advisers which gives an overview of the process.