5 April 2012
Tax credits changes from 6 April 2012
Several changes to the tax credits system were announced in the June 2010 Emergency Budget and the October 2010 Comprehensive Spending Review. Some of those changes started from April 2011, with others due to start from tomorrow (6 April 2012).
There are two main points that you should be aware of:
- There is no one income cut-off point for tax credits. It is based on your client’s individual circumstances and takes into account lots of factors. You can find the maximum income limits depending on your client’s individual circumstances in our ‘how much can your client get’ section.
- There are several changes to the system all happening at once, and the impact will depend on your clients individual circumstances. Only by looking at all of the changes together and their effect on overall entitlement will you be able to determine whether your client is better off or worse in 2012-2013 compared to 2011-2012
You can find full details of the changes from April 2012 in our current policy section:
- Removal of the second income threshold
- 50+ element withdrawn
- Backdating reduced to 31 days
- Income disregard for falls in income introduced
- Freeze of other WTC elements
- Couples with children required to work 24 hours
- Childcare element and carers
- Child element of CTC up-rating
You can find the tax credits annual and daily rates from 6 April 2012 in our how much can your client get section. You will also find all the previous rates back to 2003.
You can find the regulations associated with the changes from April 2012 below:
You can find further commentary and useful examples of the effect of these changes on the Low Incomes Tax Reform Group (LITRG) website.
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